CARI: Center for Applied Rural Innovation

 

Date of this Version

August 2003

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Published by the Center for Applied Rural Innovation, University of Nebraska-Lincoln. Copyright © 2003 by J. Allen, R. Vogt, and R. Cantrell.

Abstract

The state legislature has been debating several approaches to solve the shortage of money for the state budget. They have passed various tax increases as well as made reductions in the level of services provided. What do rural Nebraskans support doing to solve the budget issue for state aid, higher education and public aid? Which goods and services do they favor imposing the sales tax on? Do their opinions differ based on the size of their community or their age?

This report details 3,087 responses to the 2003 Nebraska Rural Poll, the eighth annual effort to understand rural Nebraskans’ perceptions. Respondents were asked how strongly they support or oppose using various alternatives to meet the budget requirements for three items: state aid for elementary and high school education; community colleges, state colleges and universities; and public aid, like medical assistance and helping low income families with children. They were also asked which goods and services upon which they would favor imposing the sales tax. Comparisons are made among different respondent subgroups, i.e., comparisons by age, occupation, region, etc. Based on these analyses, some key findings emerged:

More rural Nebraskans favor increasing revenue for state aid for elementary and high school education than decreasing this budget item. Only 15 percent of rural Nebraskans support decreasing the budget for state aid for schools. Sixty-eight percent oppose this alternative and 17 percent had no opinion. In contrast, over one-half of the respondents supported the following alternatives to fund state aid: increasing corporate income tax rates (65%), increasing the state cigarette and alcohol taxes (63%), and legalized gambling with revenues targeted for state aid (61%). Increasing sales tax revenue was supported by 41 percent of the respondents.

Almost one-half of rural Nebraskans oppose decreasing the budgets for higher education. Forty-nine percent oppose decreasing the budget for higher education, 24 percent had no opinion and 27 percent support this alternative. Over one-half support the following approaches to fund higher education: increasing corporate income tax rates (62%), increasing the state cigarette and alcohol taxes (61%), and legalized gambling with revenues targeted for higher education (58%).

Rural Nebraskans’ opinions on whether or not to decrease the budgets for public aid are divided. Thirty-nine percent oppose decreasing the budgets for public aid, 35 percent support this alternative and 26 percent had no opinion. Over one-half support the following alternatives to fund public aid: increasing the state cigarette and alcohol taxes (60%), increasing corporate income tax rates (60%), charging clients copayments for assistance (57%), and legalized gambling with revenues targeted for public aid (55%).

Rural Nebraskans’ support for increasing sales and income taxes was highest when these revenues would be used for state aid for schools. Forty-one percent supported both increasing the sales tax rate and the number of services that are subject to the sales tax to fund state aid for schools. Support dropped to 30 percent for increasing the sales tax rate and 36 percent for increasing the services subject to the sales tax to fund higher education. The support dropped even lower for these alternatives when used to fund public aid (28% and 32%, respectively). Twenty-two percent support increasing the income tax rates to fund state aid for schools. The level of support for this option was 18 percent to fund higher education and 17 percent to fund public aid.

Farmers and ranchers were more likely than persons with different occupations to support increasing the state income tax rates to fund these three budget items: state aid, higher education and public aid. Thirty-four percent of the farmers and ranchers support increasing the state income tax rates to fund state aid. Only 16 percent of the persons with administrative support or service positions shared this opinion.

Rural Nebraskans with higher educational levels were more likely than those with less education to support increasing most of the taxes to support all three areas: state aid, higher education and public aid. However, they were also the group most likely to oppose legalized gambling. Forty-four percent of the persons with a bachelors or graduate degree supported increasing the state sales tax rate to fund higher education. Only 14 percent of the persons with no high school diploma shared this opinion. When asked about legalized gambling with revenues targeted for higher education, 37 percent of the college graduates opposed this alternative. Only 25 percent of the persons with a high school diploma opposed legalized gambling with revenues targeted to higher education.

Younger respondents were more likely than older respondents to support legalized gambling with revenues targeted to fund all three budget items. Seventy-three percent of the persons under the age of 40 support legalized gambling with revenues targeted for state aid. Only 52 percent of the persons age 65 and older support this alternative.

Most rural Nebraskans are in favor of imposing the sales tax on various goods and services. Only 17 percent would not impose the sales tax on any of the services or goods listed.

Over one-half of rural Nebraskans would impose the sales tax on the following services: limousine services (69%), dating services (65%), pet grooming services (55%), interior design consulting (53%), horse boarding and training (52%), and golf and tennis lessons (52%).

Only 12 percent of rural Nebraskans favor imposing the sales tax on food. And, only 17 percent would impose the sales tax on automotive repair services.

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