The content of these pages is developed and maintained by, and is the sole responsibility of, the individual senator's office and may not reflect the views of the Nebraska Legislature. Questions and comments about the content should be directed to the senator's office at firstname.lastname@example.org
The Legislature has 13 days left in this legislative session, with the 90th legislative day set for June 5. This past week, senators gave the budget bills second-round approval. The budget is now ready for Final Reading.
As I mentioned last week, the Nebraska Economic Forecasting Advisory Board increased their projections for the next biennium by $9.7 million. The Appropriations Committee recommended the dedication of $8 million of the projected increase to the Property Tax Credit program. With the added $4 million each year, bringing the increase in the program to $64 million annually, taxpayers will see a total of $204 million per year in direct property tax relief. This credit is reflected on annual property tax statements. The Legislature approved the committee’s recommendation, prior to advancing the budget bills.
There were several other changes to the budget that were recommended by the Appropriations Committee and approved by the entire Legislature during Select File debate. Appropriations were updated for the multi-year project to replace the heating, ventilating, and air conditioning system at the State Capitol, based on continued planning and a better estimate of costs. A geothermal system has been identified as the preferred option, instead of contracting with the University of Nebraska for chilled water. Although it will cost more initially, it is expected to be more energy efficient in future years.
Funding was added to the budget for the Nebraska Developing Youth Talent Initiative. This initiative requires the Department of Economic Development to fund two pilot programs that are targeted to businesses in the manufacturing and technology sectors for two years. Grants would be provided to private sector for-profit entities, one of which must be in a rural area. This initiative will develop an industry-led partnership with schools to assist in specific career learning opportunities in manufacturing and technology sectors.
The Legislature gave first-round approval to a bill that was prioritized by the Revenue Committee. LB 259 would exempt from property tax the first $10,000 of valuation of depreciable tangible personal property in each tax district in which a personal property tax return is required to be filed. Although this wasn’t as comprehensive of a tax relief plan as some senators had hoped, it is estimated that it will provide for an average decrease of $162 in the personal property tax bills for business owners, farmers and other taxpayers.
The Legislature gave LB 610 final approval this past week on a 26-15 vote, with eight senators not voting. LB 610 proposes to increase the gas tax by a total of six cents over a four-year period. Revenue from the gas tax, which has remained flat over the past 20 years, has not kept up with the cost of road construction. The increased revenue is to be divided between the state Department of Roads, counties and cities, to be used for necessary road and bridge projects. Since the Governor has vetoed LB 610, the Legislature will need to override his veto if the tax increase is to take effect. Thirty votes are required on a motion to override, which is four more votes than given on final reading. I voted against LB 610, as I would prefer an increase in the current amount of sales tax dedicated to roads over a gas tax increase.
We have been working through the lunch hour and into the evening in an attempt to debate every priority bill. If you have any comments on the legislation that is still before us, I encourage you to contact me. I can be reached at District #1, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is email@example.com and my telephone number is (402) 471-2733.
The budget bills, as proposed by the Appropriations Committee, were debated by the Legislature this past week and were given first-round approval. The budget bills consist of 8 bills, including the mainline budget bill that appropriates funds for state government expenses, legislation to appropriate funds for capital construction, to provide for fund transfers, including those from the Cash Reserve, to provide for deficit appropriations, and legislation to appropriate funds for the salaries of the Legislature, constitutional officers and the Supreme Court judges.
General Fund appropriations total $4.26 billion in fiscal year 2015-16 and $4.37 billion in fiscal year 2016-17. This translates to a 3.8% spending increase in the first year of the biennium and a 2.4% increase in the second year, for an average 3.1% increase over the two-year period. This represents the third lowest spending growth in the last 30 years, with the lowest spending increases occurring during the recession.
Almost $49 million is available, above the required minimum 3% reserve, after funding the budget bills. This amount will be used to fund bills that are currently going through the legislative process.
The General Fund appropriations are divided into four categories. Agency Operations, which includes the University of Nebraska and State Colleges, the Department of Health and Human Services, the Department of Correctional Services, and the courts, as well as more than 40 other state agencies, represents 35.5% of the budget. State Aid to Individuals, amounts to 31.6% of the budget, and includes funding for Medicaid and other public assistance, Developmental Disabilities aid, and Behavior Health aid. State Aid to Local Governments, amounting to 32.3%, includes funding for state aid to school districts, special education, aid to community colleges and homestead exemptions. The final category, Capitol Construction, makes up just 0.6% of the budget.
Appropriations Committee members made a conscious decision to keep the Cash Reserve Fund balance at approximately 16% of General Fund expenditures. The Cash Reserve Fund is used to provide protection against forecast errors and to provide for supplemental funds during a recessionary period, which proved necessary during recent years. The Appropriations Committee did approve transfers from the cash reserve fund for four “one-time” projects, including funding for a child welfare system fine from the federal government, a court ordered settlement to Kansas relating to the Nebraska Republican River Compact, $25 million for the construction of the Global Center for Advanced Interprofessional Learning at UNMC, and $8 million for a grant program to contract for reduced-fee and charitable oral health services and for oral health workforce development with the Creighton University School of Dentistry. After senators questioned the funding that was directed at Creighton University, the language was amended so that the funding could also be utilized by the University of Nebraska Medical Center College of Dentistry.
The $60 million in increased annual funding to the Property Tax Credit program remained intact in the budget. This allows for a credit equal to $93.33 per $100,000 of valuation for property owners, up from $65.33 in the current year.
The Nebraska Economic Forecast Advisory Board also met this past week. Because it was predicted that board members might reduce their revenue projections for the next biennium, the Appropriations Committee was prepared to begin meeting immediately to discuss potential reductions in our budget recommendations. However, the Board did not alter the forecast significantly and actually increased it by approximately $9.7 million over the next biennium.
If you have any comments on the budget bills that are going through the legislative process, I encourage you to contact me. 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 firstname.lastname@example.org.