Farmers Fear Water-Downed Version Of Irrigation Tax

A potential tax on irrigation usage has farmers across Nebraska, especially Northeast Nebraska, rallying against it.

More than 300 people came together Monday night for a meeting at the Neligh American Legion to discuss several bills that were introduced during this legislative session, namely LB 1022. The bill was introducted by Columbus State Senator Paul Schumacher and would impose a one cent tax for every 10 gallons of water used to irrigate ag and horiculture land. Schmacher’s bill would also change land assessment as all ag land would be valued as dry land.

However, during the meeting in Neligh, several individuals said the proposed bill is already dead. Ron Cemper of O’Neill said LB 1022 will not go to vote. “They already abandoned it. That’s as of last Friday.”

Allan Bentley of Neligh, who was one of the organizers agreed with Cemper, but said the purpose of the meeting was deeper than the one bill.

“I’ll even admit that it’s not going to pass in this form,” Bentley said. “But I also know how politicians work. They ask for the world and then they’ll argue with the other half, and they’ll come together at some point. And they will get a watered-down version of this tax on our water.”

While the 2 1/2 hour meeting yielded no official action and no committee formed, it did spark much conversation about being active on various boards from Nebraska Farm Bureau to the Natural Resources District.

Randy Reinke of Neligh urged those in attendance to use their voice.

“You have to be loud; you have to be a voice,” Reinke said. “For God’s sakes, let’s load a cattle pot when the time is right and let’s go down to Lincoln. If we get pulled over, it’s going to hit the papers. Do something about it - land the plane.”

He added, “Get on a board. If you’re not on a board, get on a board and get involved. Those boards are united. We got people down in Lincoln lobbying for us.”

Tom Borer of Neligh, who helped orgainze Monday’s event, said it was important to immediately call the gathering in Neligh because of what the proposed bill represented.

“We just wanted to raise an awareness of this proposed tax bill and what it could do to the communities,” he said. “Our point was it was going to pretty much ruin the local farm economy, not only in Antelope County, Holt County, anybody that has a lot of irrigation in their county. It’s going to pretty much ruin it.”

Also organizing the meeting was Craig Bollwitt of Ewing. State Senators Tyson Larson, Tom Briese and Paul Schumaucher were invited but did not attend.

Many of those attending shared the organizers’ views on the impact of the proposed bill. The presentation used the example that with the proposed bill, 10 inches of water on 135 acres would be taxed at $36,650.

Greg Koinzan of Tilden spoke about the state’s ownership of the water, taxing the water, disadvantages of unicameral system and property tax relief.

“The simple fact is they can tell you how much you can pump, when you can pump and they can tell you where you can pump it. They not only own it, the state of Nebraska controls your water,” Koinzan said.

During conversation on selling of water rights, Aaron Rice, who serves as a director on the Upper Elkhorn Natural Resources District, clarified that the state owns the water, not individuals. Dennis Schueth, general manager of the Upper Elkhorn NRD, further clarified that the correct term people should be using is transferring rights.

“We never use the word ‘sell’ because that gives a part of ownership. We have allowed the acres to be transfered from Point A to Point B. The same amount of irrigated acres, so amongst the discussion the happens outside of the NRD and you want to use the term ‘sell,’ that’s your vocabulary,” Scheuth said.

Doug Hall of Neligh said he too belives LB 1022 will be abandoned, but he’s concerned about what happens next since taxing irrigation water usage has been proposed.

“They’ll negotiate this thing down. They’ll figure out some way,” Hall said. “I don’t know what the hell they’re going to come up with, but they have the idea out there.”

Bentley said landowners are guilty of being too complacent by allowing property taxes to increase. He said from 2005 to 2015, property taxes in Nebraska increased 176 percent for ag land, compared to 35 percent for residential and 49 percent for commercial property.

But as far as how to fight such potential legislation, even Bentley said those in attendance united couldn’t foot the bill for lobbyists. That’s when the discussion moved to joining other organizations that have resources in place.

Lance Knigge of Verdigre said a key issue is where a majority of the votes are from, which is urban areas. Knigge said Nebraska’s population is 1.92 million with Douglas, Lancaster, Sarpy, Buffallo and Hall counties accounting for more than 1 million voters.

“That gives you an idea of where we’re sitting with votes in this state,” Knigge said. “If any of this gets to a vote and we’re going to save something with property taxes, they’re not going to slow down.”

After hearing the discussion, Marvin Hochstein of Bloomfield stood up and questioned how many people in the crowd were in the irrigation business and attending to support the farmers.

“Would it be out of line to ask for a showing of hands for how many people are in the irrigation business and related industry and let us know how much more support we have from those we’ve supported over the years?” he asked.

About a half dozen hands raised.

Toward the end of the meeting, organizers asked several times for advice on how to proceed and if a committee should be formed. The audience dispersed without nominating anyone to speak on their behalf. Instead, organizers suggested another meeting toward the end of February.

“The way we left the meeting was everybody was going to go home and think about it. We’re going to have a meeting again in a month, bring back your ideas. From there, we’ll try and decide how we should proceed because we don’t think this issue is going to go away,” Borer said. “Even if it doesn’t make it through this legislative session, it’s going to keep popping up. We want to be proactive and try to fight this every time it comes up. The only way to do that is to stay informed, keep organized and try to work with the other farm organizations and see if we can’t work together and get these crazy bills stopped.”