Thank you for visiting my website. It is an honor to represent the people of the 14th legislative district in the Nebraska Unicameral Legislature.
You’ll find my contact information on the right side of this page, as well as a list of the bills I’ve introduced this session and the committees on which I serve. Please feel free to contact me and my staff about proposed legislation or any other issues you would like to address.
Sen. Jim Smith
The second session of the One-Hundred and Fourth Legislature is underway and we are busy debating bills that carried over from the 2015 session and introducing new legislation for consideration this year. The second session of the two-year legislative biennium is only 60 days compared to the longer, 90-day first session and while there isn’t as much time to consider legislation, there are still significant issues facing the state that warrant thoughtful deliberation.
Given the time constraints, each senator will be concentrating much of his or her efforts on bills he or she believes should be enacted sooner than later in order to have the greatest positive impact. For me, that bill will be LB 960, the Transportation Innovation Act. Nebraska’s transportation infrastructure is critical to the welfare of our state and its citizens. A safe and functional transportation system is essential to move our children to school and our workers to jobs and our products to market. For the past several years, we have been putting most of our concentration on simply maintaining our existing roads. A statewide expressway system initiated and promised 30 years ago has yet to be completed and Nebraska ranks among the worst in the nation when it comes to deficient bridges.
LB 960 would establish a Transportation Infrastructure Bank to provide funding to accelerate completion of the expressway system and create a county bridge match program to promote the repair and replacement of deficient bridges. In addition, the bill would establish an economic opportunity program within the Nebraska Department of Roads to provide funding for transportation projects that will result in new businesses and expansion of existing businesses. Initial funding for the Infrastructure bank will come from the state’s cash reserve and the bank will be replenished by funds currently flowing to the Department Roads. LB 960 is a collaborative effort between the Legislature’s Transportation and Telecommunications Committee and Governor Pete Ricketts. I am pleased to have the opportunity to sponsor this ground-breaking legislation and moving it forward.
Other measures I have introduced this session include the following:
LB 739 – eliminate the common levy imposed on members of the Learning Community;
LB 812 – exempt custom software used by businesses from the sales tax, bringing Nebraska in line with most states in the country;
LB 912 – require individuals labeled as inactive voters to provide identification prior to voting;
LB 913 – allow for the adoption of the Business Rapid Response to State Declared Disasters Act;
LB 938 – allow for the adoption of the 911 Service System Act to modernize our emergency system; and
LB 977 – provide axel weight exemptions for agriculture vehicles and machinery.
While many of the measures I have introduced are a necessary responsibility for me as chairman of the Transportation and Telecommunications Committee, I will still be actively involved in a number of issues. In particular, I will continue to push for tax relief for all Nebraskans. Last year, I introduced LB 357, which cuts both individual and business income tax rates and increases funding to the Property Tax Relief fund. LB 357 is currently being held by the Revenue Committee and I am diligently working to advance the measure to the full Legislature for consideration. I look forward to the work ahead and to serving my constituents as we decide the policies of importance to Nebraska.
The first session of the One Hundred Fourth Legislature came to an end on May 29. While I am disappointed my priority bill (LB 357) to reduce taxes for families and businesses did not make it to the floor for debate, I am pleased major transportation-related issues were tackled.
Most importantly, the Legislature approved a bill guaranteeing funds for our transportation infrastructure. As the chairperson of the Transportation and Telecommunications Committee, I am keenly aware of the immediate necessity to address over $10 billion in highway needs and to repair nearly 3,000 structurally deficient bridges. I introduced LB 610 to incrementally increase the gas tax by 6 cents over a four-year period. Federal highway funds are becoming unreliable and our state gas tax rate has remained flat for over 20 years, not keeping up with inflation.
Our transportation infrastructure is integral to keeping and attracting businesses to grow our state’s economy. I believe the most appropriate way to ensure we have adequate funding is to tax those who use our roads, including those who travel through the state. Without the fuel tax, the only funding options are either increasing property taxes or diverting General Fund dollars from other government services, such as education and Medicaid.
Another significant transportation bill was LB 629, which regulates ride-sharing operations. In the past few years, transportation network companies have been cropping up across the world and have proven to be a popular transportation option. Uber and Lyft both began operating in Nebraska over a year ago, despite not having authorization to operate in the state. While I generally support the free market principle of limited government, it became clear from other states’ experiences some sort of regulatory oversight was necessary to protect the public who use the service, as well as the drivers who provide the rides. After long and often-contentious negotiations, all interested stakeholders agreed to the provisions of LB 629, including requirements for vehicle inspections, background checks and liability insurance.
Finally, LB 623 was passed by an overwhelming majority of the Legislature to allow drivers licenses for immigrants who qualify under the federal Deferred Action for Childhood Arrivals (DACA) program. Prior to the Legislature’s action, Nebraska was the ONLY state that denied licenses to DACA grantees. We were in danger of becoming uncompetitive in the global market by obstructing a significant portion of our workforce. LB 623 had the backing of large array of groups, including the State Chamber of Commerce, the Omaha Chamber of Commerce, the Lincoln Chamber of Commerce, the Farm Bureau and the Nebraska Cattlemen.
While it was a great accomplishment get these critical matters addressed, many important transportation issues remain for the Transportation and Telecommunications Committee. Over the legislative interim, the committee will be conducting a comprehensive study of our roads system, which will include an examination of our funding sources, allocation and use of those funds by local governments and the structure and efficiency of the Nebraska Department of Roads. The study will include public hearings throughout the state.
Though the Legislature is not in session again until January 2016, my office remains open year-round, and I encourage you to contact me at (402) 471-2730 if you have any questions or concerns regarding your state government.
The Legislature gave final approval to a two-year budget that holds the line on spending as well as gives money back to the taxpayers. Nebraska’s Constitution requires the state to have a balanced budget, which the Legislature establishes on a two-year cycle. The biennium budget passed this year covers fiscal years that begin in July 2015.
Our Appropriation Committee’s initial budget recommendation largely mirrored the one proposed by Governor Ricketts. It focused on funding necessary government functions, including education, Medicaid and correctional services, promoting economic development and limiting increases in expenditures. The average growth of the two-year $8.6 billion budget package was only 3.1%, which is one of the lowest growth rates in the last 15 budget cycles.
Early in the budget debate, the Nebraska Economic Forecasting Board delivered an unexpected surprise, projecting better than anticipated revenues in the coming years. The Legislature demonstrated fiscal restraint and agreed to send the money back to taxpayers. An extra $8 million was added to the already approved $60 million annual increase to the Property Tax Credit Fund. Each year, a total of $204 million in the fund will be dispersed to property tax payers to offset the taxes paid to fund local government bodies such as school districts and counties.
I applaud Governor Ricketts and the Appropriations Committee for bringing forth a responsible budget – one that did not promote wasteful government spending and instead gave money back to whom it belongs; the taxpayer.
The 2015 session has reached the halfway point, and soon we will be spending full days on the legislative floor debating and voting on the many bills introduced this year. For the first half of the session, we have split our days with floor debate in the morning followed by committee hearings in the afternoon. As required by the Nebraska Constitution, public hearings are held on each bill introduced. This year, 663 proposals were brought forth.
While not all 663 bills are advanced from the committee for consideration by the full Legislature, hundreds are deemed worthy of extended discussion. Given that there are only 90 days in the session, the time constraints make it impossible for the Legislature to take up every measure. In order to assure the most important issues are debated, senators are allowed to designate one bill as a priority. This session, three of my bills have been designated as priorities.
I am grateful Senator Curt Friesen of Henderson has prioritized LB 610, which is a bill I introduced that would provide much-needed funding to our transportation infrastructure. The bill would increase the portion of our gas tax that goes to fund our state, city, and county roads and bridges. While I consider myself a fiscal conservative, I have firsthand knowledge (as Chair of the Transportation and Telecommunications Committee) of our immense infrastructure needs and the huge funding gap that exists.
Roads and bridges are the lifeblood of Nebraska. Businesses and industries, including agriculture, recognize a well-maintained infrastructure is needed to move produce from farm to market; to transport freight and product; and to move passengers and employees. In addition, good roads provide incentive for businesses to expand and locate in Nebraska. This infrastructure is vital for emergency services and national security and is a basic necessity for our everyday life. That said, functional roads and bridges are neither free nor cheap.
Consider this: in order to just maintain the nearly 100,000 miles of roads and 20,000 bridges, it costs almost a billion dollars every year. Because our aging bridges across the state have been neglected for so long, Nebraska has the seventh highest percentage of structurally deficient rural bridges in the nation. It is estimated it will cost over $800 million to bring our bridges up to safety standards.
Yet while we have these growing costs, funding for these necessities has not kept up. The federal Highway Trust Fund is declining and losing its value, gas prices have dropped, and cars are becoming more efficient. The state’s current tax on fuel, 25.6 cents, has increased by only one cent in the past 22 years. Neighboring states are in a similar bind – Iowa has just increased its gas tax by 10 cents per gallon and South Dakota raised its tax by 6 cents.
LB 610 takes a very modest and responsible approach. The tax would increase by 1.5 cents every year for just four years for a total of 6 cents. As far as taxes go, the gas tax is probably the most fair because it is based on usage. Those who utilize the roads more will pay more, including those non-Nebraskans traveling through out state.
But not all taxes in Nebraska are fair. As I mentioned in my previous post, I introduced LB 357 to address our excessively high personal and business income taxes. Nebraska has one of the highest top income tax rates compared to our neighbors, putting us at an economic disadvantage for attracting businesses and individuals to fill new jobs. LB 357 would lower the tax brackets over a period of eight years, protecting vital state services while putting funds back in the hands of taxpayers. In addition, LB 357 would provide property tax relief by increasing the amount of money that goes into the Property Tax Credit Fund.
I believe in an overall tax policy that adequately provides for essential government services but does not unfairly burden our businesses and families. For that reason, I have selected LB 357 as my personal priority for this year. LB 357 and LB 610 together make a sound tax policy that will move this state forward for years to come.
2015 Session Underway
The Legislature convened in January and I was elected as the new chairperson for the Legislature’s Transportation and Telecommunications Committee. For the past six weeks I have been responsible for ensuring the 50 bills that have been referred to the committee are scheduled for public hearings and discussed by the committee’s eight members. The committee decides whether the policy proposed in each bill merits consideration by the entire Legislature and either votes to advance a measure, indefinitely postpone it, or hold it until a later date. This process will continue until mid-March.
In addition to these new duties, I am still responsible for the twenty pieces of legislation I have personally sponsored, many of which are related to the transportation and telecommunication industries. This session, I was honored to assist the Nebraska Sesquicentennial Commission by sponsoring the Sesquicentennial License Plate bill (LB 220). A yet to be unveiled license plate will be available for those who want one from October 1st of this year through 2022. The specialty plate will provide the Commission with a valuable fundraising tool as it prepares for the celebration of Nebraska’s 150th anniversary of statehood in 2017. The bill passed unanimously and has already been signed into law by Governor Ricketts.
While LB 220 passed easily, another bill I introduced will present a challenge but will have a greater impact on our state. LB 357 would provide much-needed tax relief to all Nebraskans. The bill would include income tax cuts for individuals, families and businesses as well as bolster our Property Tax Credit Fund.
The Tax Foundation’s 2015 State Business Tax Climate ranks Nebraska in the bottom half of all states with respect to our tax policies. Compared to surrounding states, Nebraska has one of the highest top income tax rates, making it difficult to compete for new businesses and jobs. Over 30 states have already or are in the process of considering tax reform and it is imperative we act now or risk falling behind in economic opportunities.
LB 357 would take a measured approached to ensure any tax cut is paid in full and does not harm essential services. Tax reductions for all brackets would be slowly phased in over a period of 8 years, bringing the top bracket down from 6.84% to 5.92% and the lowest bracket from 2.46% to 1.23%. Continued growth in revenue could trigger further reductions. In addition to the personal income tax cuts, LB 357 would reduce the tax burden on businesses and would increase the amount of credit property owners receive on their tax bills. A majority of these tax cuts would be offset by reducing government spending growth by 1 percent annually, while a very small portion of the lost revenue would be replaced through the state’s Cash Reserve Fund. This savings account is at a record high of over $700 million dollars. That is $700 million dollars of taxpayer dollars that should go back to the taxpayers.
For nearly 150 years, Nebraska has flourished and grown into a state for which we can be proud. With the passage of LB 357, we can continue to grow and with the passage of LB 220, we can display the pride we have in our state, Nebraska.
A bill I introduced to provide funds for public schools to invest in career and technical education had a hearing before the Education Committee on Tuesday. LB 754 would allocate $2 million to the Department of Education to help Nebraska schools improve programs aligned with the state’s workforce needs. It is my firm belief that technical trades can be incorporated into secondary education to equip students with the skills to be successful, contributing members of the workforce.
Successful career education programs have been shown to increase student achievement and lower dropout rates. Furthermore, they prepare students for further education and careers, and promote economic development by providing business and companies with a skilled workforce. We can no longer ignore the importance of providing these opportunities in Nebraska.
Currently, the State of Nebraska provides no funding for career education programs at the K-12 level. Other states, including Kansas and South Dakota, have recently allocated millions of dollars to career and technical education. LB 754 asks for a small, but important investment for the future of our education system, our students, and our state.
On Tuesday, I introduced LB 865 to the Legislature’s Education Committee. LB 865 would eliminate the Learning Community’s common levy and address a funding deficiency of the current Learning Community law. I introduced this legislation after spending hours meeting with school board members, superintendents, city officials, and Learning Community Coordinating Council members over the interim. The message I consistently took away from those conversations was that the common levy is simply not working.
While the intention of the common levy is to help children and families in poverty, it is clear the funds are not going where they are most needed. Because of the current funding formula, the 11 Learning Community school districts have collectively missed out on 3.5 million dollars in state aid each year. LB 865 will allow the Legislature to find a better method to address the education needs of students living in poverty and help local school districts to regain control over their tax dollars.
I’m hopeful the Education Committee will look favorably on LB 865. At the very least, I believe the hearing was eye-opening for the members of the committee who have not had much experience with the Learning Community. It is clear there is a problem, and this legislation should prompt a discussion on what the Legislature can do to provide quality education for children in every school district.
The second session of the 103rd Legislature convened on Wednesday with a number of important issues already facing the Unicameral. A short time-frame—only 60 working days—means my colleagues and I will have a busy session with much to accomplish by mid-April.
Among the most important issues the Legislature will discuss this session is taxes. Tax reform continues to be on the forefront after an interim study on the topic this summer. A number of bills have already been introduced on this subject, and I expect more proposals to come. I look forward to taking on this issue and addressing the needed changes to Nebraska’s tax policy.
Along with tax reform, corrections, healthcare, and education policy are set to become priorities this session. The Legislature will take up prison overcrowding, the good time law, and juvenile justice concerns. A discussion on Medicaid expansion will return for a second time as Nebraska grapples with the Affordable Care Act. Lawmakers will also likely revisit education funding. With big issues dominating the session, I still hope to continue to make progress addressing the deficiencies of the Learning Community.
The next 57 days will be busy, and I look forward to the progress the session will yield. It’s an honor to be representing you in the Nebraska Legislature for a fourth year. Please feel free to contact my office with your concerns about the issues facing you and your family.
Wednesday saw the last day of the 103rd legislative session and the adjournment of the Nebraska Legislature. I’m pleased with the work my colleagues and I accomplished this year, including balancing the state’s $7.8 billion budget. In Nebraska, our constitution requires us to balance the budget every year. This year we did it by rejecting the unnecessary expansion of government while taking care of our obligations to the people of Nebraska, including funding education and state employee retirement.
On Tuesday, Governor Heineman signed into law a bill I sponsored to require all newborns in Nebraska to undergo screening for critical congenital heart disease. Congenital heart disease is a leading cause of death in newborns, and this inexpensive test will save lives and save the state money long term.
The accomplishment I’m most proud of this session is passage of legislation to reform the Learning Community. This bill was my priority, and the governor signed it into law last month. Its passage means the Learning Community will see significant changes, including decreased transportation costs and reduced levy authority, with new investments made in early childhood education.
Although the next legislative session will not begin until January 2014, we will spend the interim period studying issues that may result in future legislation. This year I’ve introduced resolutions that include a study of how school boundaries impact community development and a study of renewable energy policy in Nebraska.
Please contact my office if you have any questions, comments, or suggestions. Thank you for allowing me to serve another year in the Nebraska Legislature.