Gage County to end countywide sales tax, finish paying huge civil rights judgment

BEATRICE – With payoff of a huge federal civil rights judgment on the horizon, Gage County residents will see taxes going down, on two fronts.

The Gage County Board Wednesday approved a resolution that will end collection of a half-cent countywide sales tax as of January 1st……and the newly proposed budget could drop the county’s tax rate from 50-cents, to about 45-point-one cents.  The 50-cent levy was a requirement in state law allowing the county to enact the half-cent sales tax to pay off the so-called Beatrice Six civil rights judgment.

Gage County Board Chairman Erich Tiemann talked about the resolution to end the sales tax as of January 1st, which passed on a unanimous 7-0 vote.  "There was also a lot of fear that once there was a sales tax in place, that will never end. The Gage County Board was emphatic that this is a temporary sales tax. Senator Dorn's office was emphatic that this was a temporary sales tax for a purpose, and nothing else."

County Clerk Dawn Hill said the first payment on the judgment, about $1.9 million….was made in June, of 2019. That means the huge federal judgment will be paid off in about four years…half the time anticipated.  Tiemann said the county was committed to getting things back to normal.

"We made a stance as a board that we were going to continue the path, continue maintenance and operations, and we were going to aggressively pay this off. We had a goal of somewhere around seven or eight years we could have this paid off. We're going to cut about thirty percent off of that, approximately."

Because of the sales tax, the higher property tax funding, insurance settlement money, increased property valuation and a state infusion of $4 million, the judgment expected to total more than $30 million will see its last payment being made, next May. A September payment will come from the county’s current budget, while the final payment in May comes from next year’s budget. Tiemann said it was exciting to tell the public the end is near, on the judgment awarded to six people or their estates in a wrongful conviction lawsuit and verdict.

"Hey, this is almost over...we're there.....the light is getting closer all of the time."

Because the county’s fiscal year begins in July…and collection of a taxes is a calendar-year schedule, county officials say it took some creativity and discussion with Senator Myron Dorn’s office and the Nebraska Revenue Department, to determine the final payment strategy.

County Board member Emily Haxby, elected to the board part-way through the settlement payments…..credited past efforts at the county and state levels.
"Senator Dorn, as a freshman senator getting this sales tax law enacted, was a huge step, plus the four-million dollars in payments that he was able to come through with. There was a lot of cooperation with the senators that helped Gage County. John Hill (former county board member) and Erich both made many trips (to the legislature)...and especially Dawn, too...there's a lot of paperwork to get budgets, to get that all together."

The idea of state assistance toward paying the judgment was introduced by former Senator Roy Baker, then carried over by Senator Myron Dorn. Dorn negotiated a lower state allocation in order to gain enough legislative support, overcoming objections from the governor's office.  

Tiemann thanked the public for the patience it took in handling a judgment never before seen by a county the size of Gage.  "I know that there was bad feelings from some groups, but by and large the public was very supportive. They would ask questions about what was going on. I know its frustrating when we can't talk about what we're doing. But with litigation, lawsuits and constant negotiation with our lawyers, other parties....there were so many things that we couldn't talk about that we did want to explain to the public. We thank the public for their support and us, as a board, for allowing us to move forward with this."

Board member Gary Lytle said good legal advice that led to securing insurance settlement money through two specially hired attorneys was also a key part of moving the process along.