State Journal

Article Tools
  • PrintPrinter-Friendly
  • EmailEmail Article
  • ReprintReprints

Gentlemen's Agreement

In a move that is raising some eyebrows, leaders of Nebraska’s largest statewide teachers’ union have struck a deal with the state chamber of commerce over a pair of controversial ballot proposals.

Nebraska State Education Association officials revealed recently that they had entered a "gentlemen’s agreement" with the chamber of commerce not to back an initiative that would repeal a 1987 law that gives tax breaks to businesses that invest in Nebraska.

Critics say the law takes money from schools.

In exchange, the Nebraska Chamber of Commerce and Industry agreed not to support a separate proposal that would require voter approval before legislators and local governments raise taxes—a move that could lower revenue for schools.

Duane Obermeier, the president of the NSEA, said the deal was "the prudent thing" to do.

On April 24, the union’s delegate assembly voted 151-144 after an hour-long debate to reject backing the effort to repeal the Employment and Investment Growth Act, or Legislative Bill 775.

The vote came after leaders of the National Education Association affiliate disclosed the agreement with the chamber.

Mark Vasina, the president of Nebraskans for Peace, an Omaha- based advocacy group that backs the repeal, is concerned that the NSEA leadership’s decision affected the outcome of the union vote.

"It raises the question of whether the leadership remains neutral," he said.

Mr. Obermeier defended the gentlemen’s agreement, saying, "This was not some secret thing." Had the delegates approved repealing LB 775, he continued, "there wouldn’t have been any question" to back the decision.

Sponsors of the repeal drive must submit 76,000 signatures by July 2 to place the proposal on the November ballot. Sponsors of the proposed constitutional amendment on voter approval for tax increases need 108,000 valid signatures.

LB 775—initially passed to spur business growth—gives tax breaks to companies that invest at least $3 million in their Nebraska operations. From 1988 to 2003, 343 companies earned almost $1.9 billion in credits to reduce their taxes, according to a report by the state revenue department.

But critics argue that the tax breaks are being given as spending on state services suffers. For example, the legislature cut $200 million from K-12 education funding for the current biennium. Nebraska ranks 47th in the nation in per-pupil education funding.

—Rhea Borja

Vol. 23, Issue 36, Page 18

Published in Print: May 12, 2004, as State Journal

Back to Top Back to Top

Most Popular Stories