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The Appropriations Committee submitted their budget recommendations this past week to the full Legislature by the 40th legislative day, as required by legislative rule. The appropriations bills must be passed by the 50th day, which falls on March 29th this year. The appropriations bills presented this year are mid-biennium adjustments to the two-year budget passed last year for fiscal years 2015/16 and 2016/17, resulting in a net increase of $4.2 million.
Although the financial status at the end of the current biennium remains similar to what it was at the end of the last year’s session, it has fluctuated greatly during the past year. The projected status went from a positive $2.3 million to a negative $110 million after the Nebraska Economic Forecast Advisory Board reduced revenue projections by $154 million last October. This was partially offset by a lapse of unexpended appropriations, reductions in Medicaid, and a $13 million net gain when the Forecast Advisory Board met again in February, resulting in the current positive financial status of $10.1 million. However the projected status for the following biennium shows a $106 million shortfall. This volatility shows the necessity for keeping a sufficient balance in the cash reserve fund.
The $10.1 million figure is the amount of revenue above the required 3% minimum reserve, which is available to fund legislation with a fiscal impact. The reality of this figure makes it apparent that any substantial tax relief will require a tax shift or significant cuts in spending. Due to significant opposition from cities and counties, the Governor’s proposal for property tax relief will most likely not advance from the Revenue Committee as introduced. The intent of LB 958 was to slow down the increase in agricultural land valuation by limiting the state-wide increase to 3 percent per year and to slow the growth of property taxes levied by the political subdivisions. A related bill, LB 959, sought to slow the growth of spending and property taxes levied by school districts. Likewise, it has not been advanced by the Education Committee at this time.
The Appropriations Committee recommended funding three one-time projects from the cash reserve, reducing the balance by $91 million to $655 million. The transfers include $27.3 million to the Department of Corrections for adding capacity to the Lincoln Community Corrections Center, $13.7 million for the modification of two federal levee systems that impact the Offutt Air Force base, in an effort to help secure federal funding to rebuild Offutt’s deteriorating runway and keep the 55th Wing in Nebraska, and under LB 960, $50 million to fund the newly created Transportation Infrastructure Bank.
LB 960, as amended by the Appropriations Committee, creates three new programs funded by the $50 million transfer from the cash reserve fund. It also commits $400 million in additional fuel tax revenue generated by LB 610, passed by the Legislature last year. The Accelerated State Highway Capital Improvement Program will provide up-front money for major highway projects including the completion of the expressway system. The County Bridge Match Program will promote innovative solutions and provide additional funding to accelerate the repair and replacement of county bridges. Finally, the Economic Opportunity Program will finance transportation improvements to attract and support new businesses and business expansions.
Included in the budget recommendations, are amended versions of two of my bills. The first would provide a one-time $1.5 million appropriation to help with recruitment and retention of correctional staff, particularly at the Tecumseh State Correctional Institution. The other extended the current appropriations for deferred maintenance, repair, renovation and facility replacement construction projects at the three state colleges, thereby allowing for the Theater/Event Center project at Peru State College to proceed.
As legislators discuss the budget and other priority bills, I encourage your input. I can be reached at District #1, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is firstname.lastname@example.org and my telephone number is (402) 471-2733.
The Appropriations Committee completed its work on their budget recommendations for the next biennium, voting 9-0 to advance the recommendations to the full Legislature. The budget bills will be placed on General File by April 28, the 70th legislative day. The Legislature will take up the budget package on General File beginning April 30. According to the Legislature’s rules, the appropriations bills must be passed no later than the 80th legislative day, which falls on May 14 this year.
The budget, amounting to $8.7 billion, increases state spending by an average of 3.1% over the two-year period. The increase in spending is noticeably lower than the average 4.3% increase over that past 20 years. The budget package does include the concept contained in LB 364, the bill that I introduced to add an additional $60 million annually for the Property Tax Credit program, which provides direct property tax relief to property owners.
A bill to strengthen the Commercial Dog and Cat Operator Inspection Act was given first-round approval this past week. The legislation adds a definition of significant threat to the health or safety of dogs and cats. Due to recent concern regarding the inspection and enforcement procedures for licensed facilities by the Department of Agriculture, the department has updated their rules and regulations. The statutory definition mirrors the department’s regulations, clarifying that the department’s inspectors may impound animals or ask law enforcement to impound animals, if conditions pose a significant threat to the health or safety of dogs or cats. The legislation also provides for non-lapsing licenses, eliminating the difficulty the department had in taking enforcement actions against licensees whose license had expired. Furthermore, the bill removes obstacles for unannounced inspections and authorizes the department to charge a reinspection fee and mileage for reinspection trips to determine if correction of defects found in previous inspections have been completed.
As amended, LB 360 increases the annual license fee for breeders by $25 for each license fee category and imposes a new annual fee in commercial license fee categories of $2.00, times the daily average, for dogs or cats numbering more than ten. The legislation would increase the annual dog and cat license fee in cities, counties and villages from $1 to $1.25. These fee increases are necessary to adequately fund the program.
The Legislature also gave first-round approval to a bill containing many of the recommendations submitted by the Nebraska Liquor Control Commission. The legislation seeks to define hard cider as beer instead of wine, allows retirement homes to apply for liquor licenses, applies the keg laws to all kegs containing alcohol liquor, allows retail licensees to bottle and sell growlers, and offers tax credits for beer manufacturers to utilize local barley and hops. As introduced, LB 330 repealed the mandatory closing time for bars. This provision was stripped from the bill by the committee amendments.
LB 330 gave the Liquor Control Commission the authority to regulate powdered alcohol. This powder produces an alcoholic beverage when mixed with water. A successful amendment struck this authority by banning powdered alcohol in the state, except for research purposes. Senators were concerned that this new product would appeal to underage drinkers and would be hard to control.
A Unicameral Youth Legislature will be held on June 7-10, 2015 and I encourage high school students who have an interest in law, government, leadership or public speaking to register for the event. Students will sponsor bills, conduct committee hearings, debate legislation and learn more about our nation’s only Unicameral. Scholarships are available. More information and registration forms can be obtained at www.NebraskaLegislature.gov/uyl.
If you have any comments on legislation currently before the Legislature, I urge you to contact me with your thoughts and opinions. I can be reached at District #1, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My telephone number is (402) 471-2733 and my email address is email@example.com.