NORFOLK, Nebraska — New Census estimates have Nebraska’s population topping 2 million for the first time. It’s a safe bet that recent population growth is primarily happening in our state’s major cities, which act as engines propelling new business activity and attracting new people.
State policies that acknowledge this reality and encourage cities’ growth would serve all Nebraskans well.
In Norfolk, our formula for growth was not complicated: an openness to new ideas and insistence on an exceptional quality of life unique to our history and natural resources. We’ve added more than 1,100 new housing units and almost 1,800 people since 2019, making the city now the state’s 7th largest.
A vibrant downtown, including a newly redeveloped riverfront and whitewater park, and new investments from creative entrepreneurs have transformed what were once empty shells – an abandoned main street and neglected natural waterway — into new attractions for people-gathering, entertainment, and commerce.
Cities with workable game plans for growth, rooted in high quality of life and new economic opportunities, help our entire state, in turn, to grow. That growth not only produces new jobs and new GDP, it helps lessen the tax burden for everyone. How often, though, do state policy discussions feature cities as incubators of state growth and partners in the solutions to lowering tax burdens?
Hardly ever. Instead, you’re apt to hear cities lumped together with a consortium of other local governments held responsible for ever-increasing property taxes. While disproportionately high property taxes are certainly a policy problem needing to be addressed, it’s fair to ask how much cities are really contributing to the situation.
Crowds gather in downtown Norfolk, Nebraska. (Courtesy of City of Norfolk)
In Norfolk’s case, property taxes are a relatively small portion of city revenues. In 2023, they accounted for 17 percent. In 2024, the city’s levy was lowered by more than two cents, maintaining one of the lowest rates in the state. Of all the property tax a citizen pays, about 15 percent goes to the city.
New business growth and new development have been much more important to our local economy and public services than reliance on property taxes. Sales tax receipts account for nearly half of all revenue. When business activity increases, elevated sales tax receipts help pay for better public services, and city government’s dependence on property tax lessens. In the meantime, new small business entrepreneurs, agribusiness, industry, tourism and retail create jobs, attract new people and add to the state’s sales tax base.
Quality of life investments in Norfolk have been aided by this local pro-growth mentality and supported by impactful state and federal grant programs like the Civic and Community Center Financing Fund (CCCFF) and community development block grants (CDBG). More so than growth caps or curtailed local tax increment financing (TIF) incentives, state policies that help cities build communities that people want to live in, feel proud of, and connected to comprise a lasting state economic development strategy.
They’re also effective long-term strategies for sustainable tax reduction and state economic and population growth. Strengthening and expanding programs like CCCFF and CDBG can help.
Being innovative about creating new incentives for growth can, too. Making state infrastructure bank funds accessible to cities that meet certain economic growth benchmarks, such as sales tax receipt growth percentages, is one idea. TIF utilization today is as prevalent as it is because there are few other incentives for building new infrastructure associated with redevelopment or new construction projects.
Nebraska is one of the best places to live in the greatest country in the world. More and more people are starting to realize it, but maybe not fast enough.
Creative state policymaking that recognizes cities as partners in growing the good life would serve us all well. The formula is there. Let’s work together to expand it.
Josh Moenning recently completed his second term as Mayor of Norfolk. He has served as a member of the Board of Directors for the National League of Cities and the League of Nebraska Municipalities.
