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And then there were four. April 6 was the fifty-sixth day of the session. Four legislative days remain. On the last day of this last full week, a bill came forward by Senator Curt Friesen that would allocate foundation aid to every student across the state regardless of the needs or resources of the school district.
The current state formula to send aid to schools is based on needs (student population, poverty, growth) minus resources (property tax revenue) which then equals aid. This formula takes into consideration the local levy rate which school districts derive their funding. Some school districts are at the maximum rate of $1.05 and some have even exceeded this rate by a vote of the district electorate. However there are school districts whose levy rates are at $.60 cents or less. The school districts in District 30 range from the high of a $1.05 per $100 to $.57 per $100 (based on 2015-16 data). The disparity in the rates is due to a number of factors, districts that are land rich with low student populations tend to have lower rates. Districts that have high student growth and do not have the same amount of land or property tend to tax higher.
Senator Tom Briese has been working on a bill, now an amendment, to look at eliminating sales tax exemptions and taxing more of the services industry. Part of Senator Briese’s bill would consider lowering the sales tax rate. The amendment would include an increase in the income tax rates. These items, coupled together, would help fund state aid to schools which would then lessen the burden on property tax payers. I often hear that a tax shift is wrong. The legislature is just robbing Peter to pay Paul. I would make the assertion that if Paul has been paying inordinately more than Peter, it is time for Peter to bear his fair share. So yes it is a shift but one I think needs to be part of the discussion.
Another issue debated this week was voter identification requirements. LR 1 CA brought by Senator John Murante would require a voter to show a driver’s license or state identification card to vote. Those who opposed the measure stated this resolution would be infringing on a constitutional right and should not be encroached on in any way. This issue has been debated a number of times over the last few years. Senator Murante knew he didn’t have the votes so with the agreement of the opposition, a cloture motion was made much earlier in the debate than ordinarily done. The motion failed, killing the resolution for this session.
As the session is in its last days, there is a sense of urgency for some senators to pass their bills. However at this late date, mostly controversial bills remain, which can mean protracted and sometimes contentious debate. This greatly narrows down the number of bills which can be taken up in the limited time remaining.
March 29, 2018 – Legislative Update
Senator Roy Baker – District 30
In these closing days of session, we often hear criticism of the legislature for leaving so many contentious bills to be debated until the waning days. However, the sheer fact that the bills are controversial is the reason they are late in coming to the floor for debate. Legislative committees are where many of the disagreements on the bills are hashed out and adjustments made. Committees continue to meet on those bills long after the public hearing is over, to work on amendments and try to reach an accord. Often times consensus is reached, which makes the discussion on the floor easier. However, there are times when committee members do not reach agreement and eventually forward the bill to the full legislature to allow the entire body to debate the issue and ‘let the chips fall where they may’.
An example of a controversial bill that was stalled in committee and ultimately advanced to the floor was LB 640. Currently under Nebraska law, real estate owners in Nebraska receive state tax credit toward their property tax bills. Sen. Mike Groene’s LB640 would remove those tax credits and redirect the $220 million plus in the property tax credit fund to public school districts. The tradeoff in the bill would be lowering school districts’ statutory levy maximum from the current $1.05 per $100 valuation to $0.987.
When the bill came up on the agenda for debate on March 27, I led the opposition to LB 640.
First, there would be winners and losers under this proposal. A key provision of the bill says the only school districts to qualify for property tax relief aid are those that receive more than 55% of their general fund receipts from property taxes. In District 30, that leaves out the Beatrice and Lincoln school districts. In general across the state, school districts with higher enrollments are more likely to have general fund levies over $1.00 per $100 of valuation and those districts are more apt to receive equalization state aid and thus, likely receive less than 55% of their revenue from local property taxes.
Secondly, LB 640 provides state funding to equalized districts to backfill part of the gap created by dropping the statutory levy cap. Over the past 20 years, the State has only been able to fully fund TEEOSA (state aid) three times. It takes a leap of faith to think the state will be able to do so in the future, especially in light of LB947, which calls for a lowering of income tax rates.
If LB640 were to pass, the $0.987 levy cap would be ensconced in state statute. If Nebraska were unable to provide the replacement funding, the levy cap would remain in statute and would likely require 33 (of 49) senators to vote to change the levy cap, which might prove to be very difficult to accomplish. School districts would then be in the position of needing to do one of two things: procure a favorable vote of patrons to override the levy cap; or, make cuts in school programs that the majority of parents and patrons value.
Another controversial bill, the state budget bill, LB 944, became bogged down, due primarily to 14 lines in the bill that spelled out restrictions for the use of Federal Title X funds. Late on March 28th, a compromise amendment regarding the Title X language was adopted, and the legislators overwhelmingly advanced the budget bill to final reading. Final approval will likely occur during the first week of April and the bill will be sent to the Governor.
Another bill with the potential for hours of debate is LB 947 dealing with property and income tax reductions. Members of the Revenue Committee have very differing views on the efficacy of the proposed cuts, and concerns about the long-term impact such cuts will have on the state in future years. These fundamental differences in how the legislature provides property and income tax relief will carry over to the debate on the floor.
With eight legislative days remaining at this writing, much work and debate lay ahead. Whether in session or not, your correspondence is always welcome. You can contact me at 402-471-2620 or email@example.com. You can watch the Legislature in session on educational television or livestream the debate by clicking on the NET icon on the right side of the web page at www.nebraskalegislature.gov.
March 23, 2018 – Legislative Update
In the remaining days of session a sense of urgency has set in. Urgency for the senator whose priority bill remains unheard; urgency for the budget bill to move forward; urgency for a property tax relief bill to be discussed; urgency because time is now the ticking down on legislative days in the 105th, second session of the legislature. Debate on some of these bills has been protracted because of controversial issues. Many of these bills are coming to the floor late in the session because the committees had to work through some of the controversy. Once the bills are on the floor, the disagreement doesn’t go away – it just expands to all 49 members who have different perspectives on the issue. Some issues are deeply imbedded within a bill and if not for that one particular point, the bill could be debated in a less heated manner.
One such bill is LB 944, which helps address additional budgetary shortfalls for this next fiscal year. The budget has taken center stage this past week with some debate focused on the University, but primarily discussion, and heated discussion, was on language in the bill to restrict federal Title X funds to organizations that may offer or refer a client for abortions. I supported an amendment by Senator Anna Wishart regarding Title X funds that “would prohibit funds from being disbursed to an organization that uses abortion as a method of family planning or to an organization that provides directive counseling in favor of abortion. It also would require that entities receiving Title X funding submit a detailed monthly record of expenditures to the state Department of Health and Human Services.” (Unicameral Update)
I fully support Senator Wishart’s amendment. It protects Title X funds from being used for abortions, which was already the law, but it also provides accountability for Title X funds. I believe this is a compromise that tries to appease senators on both sides.
Another bill receiving extended debate is LB 295 offered by Senator Jim Smith. The bill would provide a non-refundable tax credit equal to the amount the taxpayer contributed to a scholarship-granting organization. The Committee Amendment, which becomes the bill, would allow a tax credit as follows: Individuals – $10,000 if married filing jointly; $5,000 all other taxpayers; Partnerships, LLC’s and S Corporations – $50,000; Trusts and Estates – $50,000; and Corporations – $150,000.
It should come as no surprise that I am opposed to LB 295. Having spent my career in public education, I believe state dollars should go toward public schools. Tax credits are basically an exemption on taxes that are owed to the state on a person’s or corporation’s income. The more tax credits given away, whether for corporations in the Advantage Act or for tax credits under the Opportunities Scholarship Act, the greater the reduction in tax receipts that would have come to the state’s General Fund but would now be exempt.
LB 295 is bad state policy because it erodes the income tax owed to the state and redirects it to private schools. I have no problems with a person or a corporation wanting to support a private school with a donation, but to ask the state to designate it as a tax credit is wrong.
For the past week the legislature has been going to 10 pm or later to try to debate as many bills as possible. The long hours of debate lead to short tempers but the sense of urgency I talked about only increases.
Your opinions and concerns are vital as we finish up the last few days of session. Please contact me at 402-471-2620 or firstname.lastname@example.org. To track any legislation, go to the website at www.nebraskalegislature.gov.
Fifteen legislative days remain. In that time the legislature must debate and pass a balanced budget. This is the only constitutional requirement the legislature must complete. The legislature has always passed a balanced budget within the 60 or 90 day session. I know the senators will accomplish this goal. But what remains to be done with senators, committee, and Speaker priority bills, waiting at various stages of the process, will be determined in the waning days of session.
Speaker Jim Scheer announced on March 15th that only four priority bills have been passed thus far this session. One of those was my priority bill. Seven bills are currently on Final Reading and should be passed by the legislature. However, 23 priorities are on Select File which is the second round of debate and 52 are sitting on General File, waiting for the opportunity to be discussed for the first time. Twenty-one priority bills remain in committee for various reasons.
Once bills come to the floor, it seems more and more bills are filibustered rather than being honestly debated, amended if necessary, and then advanced. With my priority bill, there were indications of potential extended debate; but in order to move this bill forward in a timely manner, I agreed to an amendment that helped resolve some of the concerns expressed on the floor.
Not every bill given a priority should necessarily be passed by the Unicameral. Just because a bill has a constituency that may want a particular issue, senators still have the responsibility to ensure the bill is good state policy.
Two issues I would like to have the chance to debate would be property tax relief and the issue of tax exemptions on the books. A number of proposals have been offered on property tax relief, some coupled with income tax relief. Other bills propose massive reductions to property tax but no explanation of how to pay for the reductions.
A bill that addresses a large number of tax exemptions, LB1084, is still held in committee. I think this is something senators need to consider when looking at tax reform. It is not just reducing property tax, or reducing income tax, or increasing sales taxes, that will make the state’s revenue stream work. A comprehensive review of all the exemptions past legislatures have granted over decades needs to be on the table if serious tax reform is to take place. But with fifteen legislative days left, I doubt this task is doable.
Please contact me at any time with your thoughts and concerns. My office phone is 402-471-2026, and email is email@example.com.
Left: Karl, a wonderful representative of Mosaic in Beatrice, visits with Sen. Baker.
Right: Nora Jelinik of Firth, visited the floor of the Nebraska Legislature.
Students representing the No Limits organization visited with Sen. Baker this week.Pictured from left to right (Shelbie Sukovaty, Kamrin Edmonds, Senator, Tess Schellhorn, and Ashley Bailey)
Enjoyed meeting 4-H members Jetta and Josiah Harvey of Beatrice at the Capitol last week, along with Mat Habrock, Nebraska Assistant Director of Agriculture.
Sen. Baker and the Hickman team, at the League of Municipalities luncheon on Feb 27.
Left to Right:
Phil Goering, Council President
Doug Hanson, Mayor
Silas Clarke, City Administrator
Kelly Oelke, Assistant City Administrator/City Clerk
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