Supreme Court Upholds Water Management Tax
On September 16, 2011 the Nebraska Supreme Court upheld the constitutionality of a 2007 law that allowed local natural resources districts (“NRDs”) to levy an occupation tax to manage water resources. The case, Kiplinger v. Nebraska Department of Natural Resources et al., 283 Neb. 237 (2011), arose following the adoption of LB 701 by the Nebraska Legislature in 2007. The Legislature adopted the law to empower NRDs to impose a tax to collect necessary funds to manage water resources. The central feature to the tax is that it is limited to persons who have indicated their intent to irrigate in the next season. Persons may opt out of the tax on an annual basis by agreeing not to irrigate. Landowners objecting to the tax filed suit in the District Court of Lancaster County, Nebraska against the NRDs and the Dept. of Natural Resources. The landowners argued that the tax violated a variety of Nebraska constitutional provisions, including that the tax was tantamount to a property tax. The District Court held the tax was constitutional and the Supreme Court affirmed. The NRDs were represented by water lawyers at Blankenau Wilmoth.