A proposal to boost state per-pupil funding and lower the percentage of land that districts can tax may benefit rural school districts that struggle to generate funds from property taxes, according to a recent article from the Associated Press.
The proposal, which was introduced by State Senator Al Davis, would reduce the percentage of agricultural land that can be taxed by school districts under the state’s funding formula, which would then qualify more school districts for additional state aid. School districts would also be able to create a local income tax as needed to increase revenue. “Reliance on agricultural land for school funding will be reduced,” according to the proposal, “and with that the threat of major cuts to schools or property tax increases that would come should agricultural land valuations drop.”
Nearly 85 percent of Nebraska’s school districts are small and rural, according to the Rural School and Community Trust, and the amount of funding the state provides to its rural schools is lower than any state except for Rhode Island.
According to data from the U.S. Census Bureau in Davis’ proposal, the state provides nearly 32 percent of funding for schools, compared to the national average of more than 45 percent. Nebraska schools rely on local property taxes more than the national average, with more than 48 percent of school funding coming from local property tax, compared to 29 percent on average nationwide.