How Lincoln Raised Property Taxes Without Raising Rates

Lincoln’s new budget levies the same property tax rate as last year, with Mayor Gaylor Baird boasting that “except for voter-approved stormwater bonds, the city of Lincoln has not increased the property tax rate during my administration.” The statement is accurate—and yet Lincoln homeowners’ property tax bills will increase under the new budget. Same rate, higher taxes. 

Property tax rates are multiplied by a home’s assessed value, and valuations have been rising dramatically in recent years. If the rate remains constant while valuations increase, tax bills rise. That’s what is happening in Lincoln: the total value of taxable property increased from $35.5 billion to $38.5 billion, an increase of about 8.5 percent, last year. Some of that represents the value of new construction, but most of it comes from existing properties being worth more. 

Countywide, only about 15 percent of the valuation increase was attributable to new construction. (Comparable data are not readily available at the city level, but Lincoln is more than 80 percent of Lancaster County’s population.) The rest came from reassessing existing properties, with existing homes’ assessed values rising about 8.8 percent on average. 

This is why the mayor can truthfully say that there have not been any rate increases under her watch, while at the same time, the city’s tax-funded budget rose from $284 million in FY 2025 to $302 million this fiscal year, and under the new budget it will increase to $317 million in FY 2027 and $335 million in FY 2028. That’s an 18 percent nominal increase in anticipated tax collections between FYs 2025 and 2028, without rate increases, and most of it comes from higher tax bills on existing property. 

Lincoln, like all cities, faces real cost pressures. Inflation affects governments as well as individuals, and the goal is not necessarily nominal revenue neutrality with respect to existing properties. But taxpayers deserve full transparency about when their tax burdens will rise, and why. Assessed value appreciation gives local officials the opportunity to raise taxes without voting to raise rates. But “we didn’t raise rates” and “we didn’t raise taxes” are not the same thing. 

The non-choice of keeping the rate the same despite assessed value increases is, in fact, a choice to keep the extra revenue. And it is not a choice borne of deliberation, based on careful determination of how much additional revenue (if any) is necessary to provide services demanded by residents. It is a decision made on autopilot, keeping all the additional revenue possible without being seen as raising rates. 

If last year is any indication, city property taxes on existing property could be more than 6 percent lower than the budget authorizes and still raise as much revenue from those properties as last year. Even if local authorities chose to retain some of the increase to account for inflation, they didn’t have to keep all of it. 

Some jurisdictions made different choices. Grand Island has likely gone the furthest, trimming rates each of the last seven years to keep collections steady at around $12.8 million since 2018. 

And of course, city property taxes are just part of the picture. In fact, for Lincoln residents, they only accounted for about 18 percent of total property tax burdens in 2025. A full 62 percent of Lincoln residents’ property tax payments went to local schools, about 13 percent went to the county, and the remaining 7 percent went to a variety of other taxing authorities (the airport authority, a natural resource district, correctional facilities, agricultural societies, etc.). 

Last year, the city’s rate increased slightly, the result of voter-approved stormwater bonds. Absent that increase, the rate would have remained flat, but even that represented a divergence from other taxing jurisdictions in the county. In 2025, all other taxing authorities in the county reduced rates by about 6.9 percent, from a combined $1.47 per $100 to $1.37. The city, by contrast, was content to simply avoid a rate increase (excluding the stormwater bonds). 

That’s a choice city officials are free to make. But Lincoln residents, and those in other jurisdictions making similar choices, deserve to understand why their tax bills keep increasing even as local officials insist that they haven’t raised taxes.