Thursday, February 16, 2012

Hot topic

A hot topic around Nebraska right now is the Governor's plan to eliminate the inheritance tax.  I sent written testimony to the Legislature's Revenue Committee on this topic, expressing my concern about what could happen if Lancaster County loses the $6 million in annual revenue from this source.  What concerns me is that the County will eliminate mental health services, which have already been slashed considerably in recent years.

The reason I'm concerned is that if the Community Mental Health Center and the Lancaster County Crisis Center wither away, the problems of people in mental health crises will even more often become those of the police and paramedics.  This has changed hugely over the years: more and more responsibility has devolved upon the police and our emergency medical system.  In 2011, the police department responded to 2,530 mental health investigations, including 29 suicides, and 258 attempts.  We took 298 people into emergency protective custody, and figured out other options for the remaining 2,203.

That's a huge amount of time, and it comes at a considerable cost.   A significant reduction in community services to the mentally ill will result in more people being transported to the emergency room or the jail. These are very expensive services, and I think we would be money ahead to prevent this outcome.  My bigger concern, though, is an ethical one. For what other illness would the default community response be "call the cops?"  People in mental health crises need community support services, and sometimes (rarely) a hospital bed. What they do not need is a pair of handcuffs and the backseat of a patrol car.  With depressing frequency, that seems to be the best we can muster.


Jake said...

Ignoratio elenchi. That is all.

Tom Casady said...


Verum est.

Anonymous said...

Of course they'd have to raise property taxes to cover the shortfall. Here's why county officials want the funding to continue being sourced from an existing inheritance tax, and not from increased property taxes:

You don't have to pay an inheritance tax until you're dead, whereas you have to pay a property tax twice per year. Voters get mad enough about property taxes, and increasing them will make them even madder - likely at the time county officials are running for re-election. Residents with a lot of money (that might make large political donations) tend to own a lot more property, and any hike will get them really, really mad.

Now, if a county official thinks that raising property taxes (perhaps to make up a revenue shortfall caused by repeal of another tax), then raising them should be a no-brainer, and you should just do it and risk the ire of those voting taxpayers at the ballot box. However, if re-election is an official's #1 priority (as it usually is for nearly all elected officials), then those county officials might be very hesitant to make up that revenue shortfall by raising taxes, because it might mean getting the boot come election time.

In short, elected county officials who object to repeal of the inheritance tax, and claim that they'd just have to raise property taxes to cover the gap, are really saying that they don't want to jeopardize their chances for re-election, but they're too dishonest to say that outright. That's it in a nutshell.

Tom Casady said...


I understand the politics quite well, I'm just concerned about what happens to our police officers and firefighters at the end of the day. I hope it's not the dumping of another serious social problem on a workforce ill-equipped to cope with it, and to the detriment of those who need the care.

Steve said...

If I may suggest, the inheritence tax is not paid by the person who died, but by the heirs. I'm sure there will still be plenty of anger to go around regardless which tax is used to pay for services.

I don't know all the details of the inheritance tax, but from what I've gathered over the years, it's not something that will ever concern me directly. Property tax, on the other hand most certainly does.

The argument over the fairest way to tax for needed services has gone on since the country began, and I'm sure it will continue.

On the bright side, we needn't fear the property tax going up. Our beloved Mayor will increase the sales tax instead!

Maybe we can increase the arena tax to help pay for those services Tom is afraid will get underfunded.

Anonymous said...

County-level public expenditures should be funded by county-levied taxes, not by state (or federal) taxes or grants from the upper to the lower level. Ditto for state and local public expenditures; they should be funded by taxes levied at those respective state and local levels. That keeps the "money pipe" short as possible, and ballot-box risk to elected officials as high as possible.

Voters should always have the opportunity to exact ballot retribution on those responsible for raising their taxes.

Anonymous said...

Tom-I'm certainly no expert on Nebraska Tax law, but is the inheritence tax directly linked to funding mental health related programs and entities?

By comparison, I believe our State Income Tax is about triple that in Nebraska, BTW.


Tom Casady said...


No, the inheritance tax goes to the County, but it is not earmarked. It is past practice that makes me think we are at risk for gutting community mental health services. The county board is running out of options. The cost of opening up the new jail is creating a giant sucking sound.

Anonymous said...

I wonder what percentage of these Mental Health problems are caused by misuse of Alcohol, illegal drugs or even Prescription drugs?

The best way to teach children is by example but many of our youngsters do not have positive role models to look up to much less responsible parents. My generation had Roy Rogers, Gene Autry etc as role models.

We are burying Whitney Houston. She was worshipped by many young people and they wanted to be just like her. Tim Tebow is ridiculed because he is seen as a goody two shoes. Millions of people will be dancing in the streets if/when he does something stupid or immoral.

Which of the two is the best role model for your kids?

Gun Nut

Anonymous said...

Tom-As usual, you've stimulated some thought and research. Contrary to my previous message, our income taxes are only slightly higher. Our property taxes are based on all property, not just our real estate, so we pay a bunch every time we tag our vehicles. They are looking at charging more property tax on boats and planes as well. All state/county/municipalities are faced with budgetary problems, and I'm with you as far as further cuts to mental health programs. Federal entitlement programs account for 67% of our annual budget. I surely don't know what the answers are, but I'm not a fan of inheritance taxes, as someone that has earned income, paid taxes, and successfully invested the money to accumulate more assets (such as farmland) shouldn't have to be taxed again at death and sell the farm to pay even more taxes. Best wishes,


Anonymous said...

Tom, with the new jail being addressed.....Did they build it big enough to add prisoners from other jurisdictions? I know that LSO has to push out prisoners to other locations to hold from our old jail. I am guessing that they are paying a nice $$$ to do so. Can this new jail do the same for us to help pay the cost back? Do you know what it cost to hold a prisoner for one day? Out of you comfort zone I know, but I am sure there is a graph somewhere for it!


Tom Casady said...


Last I knew it was in the $65 per day range, but that's been a while. I think they've planned on renting extra beds in the new hotel all along--especially to the Feds. And you're right: Lancaster County has been boarding customers in other inns.

Anonymous said...

Speaking of the new jail, it looks somewhat modular in design, though that may just be my imagination. If it is indeed modular, I wonder if more modules could be added at a later date to boost capacity.

Anonymous said...

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