On July 10, 1991, the Nebraska Supreme Court held that the state property tax system violates the Nebraska Constitution and suggested that the system also may violate the equal protection clause of the Fourteenth Amendment to the United States Constitution. In MAPCO Ammonia Pipeline, Inc. v. State Board of Equalization & Assessment, the court declared most of the personal property exemptions unconstitutional and severely restricted the legislature's ability to classify and exempt property under the present constitution. The decision has confused many Nebraska citizens and created a crisis for the Nebraska Legislature. The court has sent the message loud and clear to the legislature: It is time to change the Nebraska property tax structure. However, the court failed to guide the legislature on how to develop a politically acceptable property tax system that passes judicial scrutiny and makes economic sense. Unfortunately, the court leaves the citizens of Nebraska with more questions than this Note possibly can encompass. In recognition of this limitation, this Note addresses three obstacles set out by the court's opinion: (1) Article VIII, section 1 of the Nebraska Constitution (the "uniformity clause"); (2) article III, section 18 of the Nebraska Constitution (the "special legislation clause"); and (3) the Fourteenth Amendment to the United States Constitution. The Note analyzes each of the obstacles in the framework of the property tax system considered by the court in MAPCO. Finally, the Note examines the immediate consequences of the court's decision.
Tami L. Johnson,
The Nebraska Personal Property Tax Crisis: MAPCO Ammonia Pipeline, Inc. v. State Board of Equalization & Assessment, 238 Neb. 565, 471 N.W.2d 734 (1991),
71 Neb. L. Rev.
Available at: http://digitalcommons.unl.edu/nlr/vol71/iss1/7