NEBRASKA LEGISLATURE
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Sen. Dan Watermeier

Sen. Dan Watermeier

District 1

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Legislative Update

January 17th, 2014

The Governor gave his final State of the State address to the Legislature this past week. He began his speech on the topic of health care, referring to the many problems with the federal Affordable Care Act. The Governor said that the new federal health care law will cost the State of Nebraska more than $200 million in state general funds over the next six years. He is still strongly against the expansion of Medicaid, which was originally part of the federal plan, but due to a lawsuit became voluntary for states.

Senator Kathy Campbell, the chair of the Health and Human Services Committee, introduced LB 887, the Wellness in Nebraska Act. It is her second attempt to expand Medicaid in Nebraska, proposing to offer Medicaid coverage to adults age 19-64 with incomes up to 100% of the federal poverty level, while those with incomes above 50% of the federal poverty level would have to contribute 2% of their income. For these newly eligible with incomes between 100% and 138% of the federal poverty level, insurance would be purchased through the marketplace, with the enrollees paying 2% of their income and Medicaid paying the remainder. The plan would have to be approved by the federal government.

Although the federal government has agreed to pay 100% of the costs for the first three years of the expansion, dropping to 90% after that, the Governor fears that the state’s share could jeopardize funding for other important programs in Nebraska, such as K-12 education and higher education. He also questioned whether the federal government will keep their promised commitment.

The Governor also addressed crime and punishment. He recommended legislation that will make violent criminals earn their “good time”, instead of automatically receiving it. Currently, Nebraska’s prisons are at approximately 150% of capacity. Some senators expressed concern that this change could enhance the overcrowding problem, while not addressing the underlying problem, of lack of services to prepare the inmate to live in the community. The Governor offered some suggestions for short-term prison capacity issues, but recommended further study for long-term changes.

Senator Brad Ashford, the chair of the Judiciary Committee, introduced LB 907. This bill incorporates the concept of “supervised release”, which has been shown to result in lower rates of recidivism than if inmates are released without supervision. The use of structured monitoring is intended to help inmates adjust to life outside of prison. Each inmate would undergo a comprehensive risk and needs assessment prior to release.

The Governor stressed that the biggest and most important issue facing the state is high taxes. He indicated his support for the Nebraska Farm Bureau’s proposal to lower agricultural land valuations from 75% to 65%. Last year, I introduced LB 101 which proposed this same concept for school taxation purposes. The Governor also recommended a decrease in the top individual income tax rate.

Governor Heineman suggested that the state could offer up to $500 million in tax relief over the next three years, considering our strong cash reserve and our growing economy – if we strictly limit spending. Senators, remembering how a strong cash reserve helped carry our state through the last recession, may be reluctant to spend down the cash reserve too far.

If you have any comments on the Governor’s speech or on other legislation that has been introduced, I encourage you to contact me. I can be reached at District #1, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My e-mail address is dwatermeier@leg.ne.gov and my telephone number is (402) 471-2733.

Sen. Dan Watermeier

District 1
Room #2108
P.O. Box 94604
Lincoln, NE 68509
Phone: (402) 471-2733
Email: dwatermeier@leg.ne.gov
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