The line chart above compares the actual growth in net property taxes with what they would have been had they grown at the same rate as two other measures of the economy. First, property taxes would be higher today if they had simply grown at the rate the Nebraska economy has grown since 1980. The measure of growth in the economy that is used in this presentation is Nebraska personal income as determined by the U.S. Bureau of the Census. On the other hand, property taxes have grown faster since 1980 than they would have if they had grown at the rate of inflation as measured by the Consumer Price Index.

Since 1990, several policy initiatives of the Legislature have slowed the growth rate of the property tax. Some of those may be reviewed by clicking on the box that appears below the line chart. For example, major school finance legislation reduced the property tax support of K-12 education in 1990 and 1998. The imposition of levy limits on local governments, which were effective also in 1998, is also evident on the chart. Property tax growth from 1995 to 2000 was barely greater than the growth in CPI, and would have been less than CPI growth had there not been a dramatic increase in voter-approved bond issues that have pledged property tax revenue.

Recently, state budget cuts have reduced or halted the growth in state financial aid to local governments and caused an acceleration in the rate for property tax growth. For a more complete discussion of this policy trend, go to "Major Trends in Tax Policy - The Shift Away From Use of the Property Tax."