The Nebraska Unicameral has completed 59 of the 60 days of the session, the last part of a two year biennium. This final week of work was mainly focused on final reading and passage of bills. 

We will now be in recess for the next five days. This allows the Governor the time allotted by law to sign or veto any of the bills passed and sent to his desk. Should he veto a bill, that leaves one last day for a senator to move to override the veto. If that happens, we will take up those motions on our 60th day, which is April 20. 

Major legislation in this 107th Legislature included a tax rate reduction / tax credit package, distribution of the unprecedented $1.04 billion in federal funding from the American Rescue Plan Act (ARPA), and passing a budget that has had to account for a variety of factors. 

My position on the Appropriations Committee the past four years made me keenly aware of the need to balance the needs and wants of our citizens. It is safe to say we all have recommendations for what the state should provide to us as tax paying citizens, while at the same time wanting our taxes to be as low as possible. I am firmly in that camp as well. It really is a balancing act to produce a balanced budget, but I have thoroughly enjoyed my work on the Committee.

As I have covered in this update in recent weeks, it took multiple efforts to get a tax package across the finish line. LB 873 became the vehicle for reducing income tax rates. This will occur over several years, and will reduce the top individual rate from 6.84% to 5.84% by tax year 2027. This bill also included provisions to eliminate state tax on social security and insure a refundable state income tax credit does not fall below its current amount of $548 million, first enacted in 2020. On the revenue side of this issue, the state general fund will be reduced by $115.5 million in the next fiscal year, and that amount is estimated to reach a reduction of $948 million by FY2027-28. This bill was signed into law on Wednesday by the Governor.

The ARPA funds coming into Nebraska were distributed through LB1014. Federal guidelines for these dollars included use for mitigating the effects of the pandemic, providing premium pay for essential works, and funding water, sewer, broadband and infrastructure projects. Physical and mental health services, care providers for those with developmental disabilities and non profits working with food assistance are some of the recipients. Workforce housing and shovel ready construction projects will also benefit from this federal program.

Some high profile legislation dealt with the proposed lake between Lincoln and Omaha, and the canal project to insure water flow into Nebraska from Colorado. Another measure will devote federal funds to qualified census tracts where poverty has become critical. This same bill also supports innovation hubs, airport business parks, affordable housing and some tourism projects, all designed to improve economic conditions. 

Looking back at the work done by the Legislature since convening in January, there have been a number of very important issues discussed on the floor. Some were passed into law and others failed to advance. Such has been the case in every Legislature since 1867. We have to remember that every measure can be adjusted, if it doesn’t work out as well as we hoped; and any bill can be reintroduced if it didn’t succeed the first time. Or a second time, or more for that matter. 

With that in mind, I commend the senators who have completed their terms in service to the state and will not return to the Legislature next year. They are: Sen. Friesen, Henderson; Sen. Gragert, Creighton; Sen. Matt Hansen, Lincoln; Sen. Hilkemann, Omaha; Sen. Hughes, Venango; Sen. Kolterman, Seward; Sen. Lindstrom, Omaha; Sen. McCollister, Omaha; Sen. Morfeld, Lincoln; Sen. Pansing Brooks, Lincoln; Sen. Stinner, Gering; and Sen. Williams, Gothenburg. Of these thirteen senators, eight of them chaired a committee. They will be missed for their valuable ‘institutional knowledge’.

I count it an honor to represent you in the Nebraska Legislature. If you have concerns, ideas for legislation, or questions about bills and laws, please contact me.  The office is always available throughout the interim. mdorn@leg.ne.gov  402 471-2620  www.nebraskalegislature.gov  PO Box 94604, Lincoln NE 68509-4604

This past week was quite similar to the previous one with long days of debate and important issues before us.  Not every measure advanced, but some critical legislation was passed. 

LB 933 was the bill that would ban abortions in Nebraska, if the Supreme Court overturned Roe v. Wade.  We took about eight hours of debate, so it needed 33 votes to break the filibuster. I am a co-sponsor of the bill and of course, voted to support it. However, only 31 yes votes were cast, so it most likely will not come up again this session. I do expect some form of the bill to be brought back next year in the 2023 Legislative session. 

LB 873 was passed on final reading, and now goes to the Governor for his signature. This bill number may not be familiar because two other bills were used as vehicles for a tax package but both failed to advance. The third attempt amended the income and social security tax reductions into LB 873. The bill lowered individual and corporate income tax rates; eliminated an income tax on social security benefits; guaranteed the amount of credit available for property tax paid for K-12 schools, and added property tax paid for community colleges to that credit program as well. This credit must be claimed on your Nebraska tax forms. 

Several veto override motions were taken up this week. Using the strong financial position of the state as it stands today, the Appropriations committee and the Legislature’s fiscal office worked diligently to produce a budget. And as a member of this committee, I can tell you our decisions about the budget were well thought out.  Three bills comprised the budget, LB 1011, 1012 and 1013. These were passed last week and the Governor used his line-item veto authority to reject certain portions. All three bills were restored by more than enough votes to override the vetoes.

It was important to me to put provider rates back to the level we had appropriated in the budget, with an increase of 15%. The Governor had line-item vetoed about $50 million allocated for child welfare providers, developmentally disabled care providers and others. As we have heard in the past 24 months in particular, staffing issues and extra costs, as well as an increased need for care, have reached a critical stage. I felt it was important for the state to show a firm willingness to support this sector of our economy and these human services. If Medicaid rates are higher, it allows facilities to take on more of those patients and still keep their bottom line healthy, provide jobs and keep their facility open. This is vital for our district and for the state of Nebraska.

Another attempt to override the Governor’s veto was close, but fell one vote short. LB 1073 would have required the Governor to request additional rental assistance from the federal government. During discussion on this override motion, we learned that in rural Nebraska, nonprofit organizations were not available to disperse the funds like they were in Lincoln and Omaha. Individuals had to get online to request the funds and the process was somewhat difficult. As a result, not all of the original federal allocation for rural areas was dispersed. The state will still get another $70 million but it will be allocated to Lincoln, Omaha and their counties.  We hear there is still a great need in rural areas, and the additional $50 million would have been for those areas. 

After much negotiation and extended floor discussion about LB 920, proponents of the criminal justice sentencing reform bill said they would rather let the bill go as it had been amended, and bring it back in the future. A study of the corrections system last year produced 21 suggestions to deal with our prisons; 17 of those were included in a bill with agreement among the study group members. Another four issues did not have a consensus but were included in the bill. Sen. Geist’s amendment removed those four main points, resulting in a filibuster which fell short of the votes needed to advance. 

There is about $240 million sitting in a fund for construction of a new prison, but it has not been officially allocated and cannot be spent without legislative approval in the future. Again, I do not feel like one can advance without the other – we need both sentencing reform as well as improved or additional facilities to help solve our problems in the corrections system.

LR 264CA, if it had passed through the three stages of debate, would have ended up on the November ballot for voter approval. This measure was called the “epic consumption tax”. A simple description of the bill is it would have eliminated property, sales and income taxes, and instead would have implemented a tax on all new purchases of around nine percent. I voted against this because there are far too many unknowns about completely tossing out our tax structure. Entities from schools, counties, NRDs,  townships, fire districts, etc., would all have their funding coming to the state before it was dispersed back out to local areas. 

Basically with a consumption tax, the state would be in control of all of these funds, and there would be less local aspect to the tax collection. My fear was that if revenue went flat or below projection, local entities would have been at the mercy of the state’s appropriations no matter what their budget required. 

While I definitely agree that our tax structure needs overhaul, I did not feel the specifics of revenue collection and distribution were spelled out well enough in LR 264CA to ensure all local subdivisions would have a strong voice, be treated equitably, and be able to operate sustainably. I do believe we will continue to discuss the more intriguing parts of this concept in the next session.

There are only four days left in the current session, but I encourage you to keep the lines of communication open with my office. Contact me at mdorn@leg.ne.gov or call 402-471-2620. 

The main concern you hear from people as an elected official, especially as a state senator, is taxes. It took three bills, several amendments and some late evening sessions, but the Legislature has advanced a measure to address income and property taxes. 

LB 873 was debated on the floor by “dividing the question”, so five sections of the bill were discussed in turn.  The first piece dealt with individual income tax rates. After much debate, the amendment was approved that would cut Nebraska’s top individual income tax rate in several steps from the current 6.84 percent to 5.84 percent by tax year 2027.

The second portion of the bill focused on corporate income tax. This portion of LB 873 would continue the phased-in reduction of the state’s top corporate income tax rate, which applies to income in excess of $100,000, approved by the Legislature last year. The committee amendment would cut the rate from the current 7.5 percent to 5.84 percent by 2027.

Next was a section to offset property tax paid towards community colleges. Similar to the existing credit for K-12 school property tax, it would create a refundable tax credit under the Nebraska Property Tax Incentive Act (NPTIA) based on the amount of property taxes paid to a community college.

That property tax credit fund was addressed in the fourth component, to ensure the refundable state income tax credit does not fall below its current amount of $548 million. NPTIA was first created by the Legislature in 2020.

Finally, a phase out of income tax on Social Security benefits was amended into the bill. This amendment included the provisions of LB825, introduced by Sen. Brett Lindstrom, to exempt Social Security from state income taxation by tax year 2025. 

The comprehensive tax bill, LB 873, now moves to second round debate. The goal of the tax package is to benefit both individuals and businesses, encourage all to stay in Nebraska and increase economic growth. I do have some concerns about how the state budget will look a few years down the road, when we are no longer experiencing the influx of federal pandemic dollars like we are right now. But it is crucial to lower tax rates and guarantee property tax credits remain in place. 

Another major piece of legislation is pending in LB 920. This bill from Judiciary Committee Chair Steve Lathrop looks at the way we impose sentencing on those convicted of crimes, and how we deal with their eventual release and parole. 

A discussion of LB 920 also involves the Governor’s plan to construct a new facility to handle current overcrowding. Nebraska presently ranks among the nation’s most overpopulated prison systems. Several senators and other state officials worked with the Crime and Justice Institute last year to look for ways to deal with the problems in Corrections. 

The study showed that while fewer inmates did enter the system in recent years, they had longer sentences and lengthy release processing. This complicates the problems of high prison population and low staffing numbers. 

As I have mentioned before, in order to achieve genuine improvement in our Corrections system, there needs to be attention given to both improving our physical capacity and enhancing our training and programming. Incarceration is expensive on many levels. Restoring previous offenders to meaningful, successful and productive lives is just so much better overall for our state and everyone involved.

Debate on LB 920 will resume next week but will also be competing for time with other key issues as we enter our final seven working days of the session.  The Legislature will be taking up a motion to override the veto of the Governor on federal rental assistance funding, as well as finalizing the South Platte canal project, the recreational lake between Lincoln and Omaha, and the nearly $1 billion package of American Rescue Plan Act (ARPA) federal fund expenditures. Also waiting to be finished up are bills on rural housing, broadband and LB 933 which would ban abortion if the Supreme Court overturns Roe v. Wade. 

I welcome your communication as we continue our work on these issues.  Please contact me at mdorn@leg.ne.gov, or call 402-471-2620. The website can be found at www.nebraskalegislature.gov

Nearly all of our time the past two weeks has been taken up by either revenue or budget bills, and at the same time, discussion has covered a vast range of topics. Early in the week, we took up LB 939. Sen. Linehan proposed this bill to lower the income tax rate over a number of years. It passed the first round and was on second round debate; amendments were added to incorporate parts of Sen. Briese’s LB 723 to guarantee the fund for future property tax credits to around $560M; another one was to phase in credits for property taxes paid for community colleges over the next few years. Opponents of the bill mounted a filibuster, which would have eliminated the chance to vote on adding these amendments. 

Sen. Linehan chose to pull LB 939 and planned to use a different bill, LB 919, which would incorporate the provisions noted above. The only issue was that this bill had to start over on first round debate. As an alternative Friday morning on the floor, elements of LB 939 were amended on to Sen. Brett Lindstrom’s LB 825, which would phase out taxes on state Social Security benefits, and was already on second round debate. After four hours, a vote for cloture failed. At this time, LB 825 and the accompanying amendments are off the agenda. 

The analogy of a three-legged stool is often used in tax conversations. This concept began under Gov. Norbert Tiemann back in the 60’s. But the balance of the “stool” eroded over time as property values rose, and other taxes fell due to various changes in the economy, resulting in a shift of more of the burden on to property taxes. This year you can get 25% of school property taxes paid (excluding school bonds) as a credit on your income tax. You must apply for that, but the process has been made easier on tax forms this year, a little more user friendly. 

Turning from revenue to appropriations, we passed the three budget bills in the first round debate last week. All three, LB 1011, 1012 and 1013, were filibustered for eight hours. On Thursday, we took them up for the second round. This includes the cash reserve or “rainy day fund”, addressed in LB 1013. I would like to see at least $950 million maintained in that fund to give us a reserve and a cushion for the next couple of years as we wait to see what effect inflation and international events will have on our economy. 

 LB 1013 would use $513 million from the cash reserve to pay for $53.5 million towards the Perkins Canal project to secure water rights in the South Platte River coming into Nebraska from Colorado and $50 million for surface water irrigation improvements, which after over 50 years, need some upkeep; the “Star Wars” lake between Lincoln and Omaha, as well as upgrades and maintenance at locations such as Lewis & Clark and Lake McConaughy; economic development, rural projects, workforce housing, military base development and funds for the Youth Rehab and Treatment Center (YRTC) in Kearney. 

Some of the floor debate focused on money set aside from the cash reserve for a new prison, $175 million, sitting in a fund for use if, or when, the Legislature would decide to proceed with that construction. Based on a study of prison reform conducted last year, Sen. Lathrop introduced LB 920 and he asserts that without these changes in sentencing, we will always be behind in trying to build enough capacity for all the inmates and we will not catch up. 

Every year approximately 2000 of our 5500 prisoners are released, and we need programming and training to keep those people from offending again and getting sent back into the prison system. Instead, we need to help them become productive members of society. Sentencing guidelines, staffing, parole supervision and programming are some of our challenging issues. 

I supported LB 1073 which would have required the Governor to apply for additional rental assistance from the federal government. Nebraska is one of just two states that has not taken advantage of these federal funds. The Governor had said it was not necessary and that he would not apply for those funds. I believe these funds help fellow Nebraskans whose jobs were impacted by Covid and are struggling financially to make up lost ground. In addition the rental assistance goes to the landlords who are trying to keep their rental properties viable. 

LB 1073 passed the first and second rounds with enough of a margin to advance. However, this week, the bill only passed on Final Reading with a vote of 26. The bill had an “emergency clause” which required a vote of 33. The bottom line is without 33 votes, LB 1073 would not take effect until long after the federal deadline passes for the application. The only way to get the funds into Nebraska would be for the Governor to apply on his own. Most likely the state will not be getting these funds unless the federal government extends the deadline.

A separate budget bill, LB 1014, deals with the American Rescue Plan Act (ARPA) money allocated to Nebraska, $1.04 billion. Designated a “super priority” bill by the Legislature’s Executive Board, it allowed the Speaker to have some flexibility in scheduling amendments and the amount of time taken on each. We were able to take a vote on the bill by 6:30 pm on Wednesday. For a senator who wanted to get funding for a proposal not included in the original bill, amendments had to specify a program or project to reduce or eliminate, and move those dollars from one program to another. One successful amendment was offered by Sen. Brandt, allowing small livestock processing facilities to access funding for expansion. That should be a tremendous help to any smaller meat processors we have in District 30. 

ARPA is a time restricted, finite amount of money, so it has generated a lot of interest among the 49 legislative districts.  I am committed to being fiscally responsible and sound going forward these next few years when ARPA and other federal funding is no longer available. We cannot spend so much in the near term and then find ourselves without that revenue in the years ahead. The result could be we would then have to make painful budget cuts. We need to analyze these ARPA proposals for their value as long term investments that will help the people of Nebraska.

Action on the main budget bills needs to be completed by the 50th day of the session, which is March 29. I expect more time to be spent on extended debate, including on a ‘pull motion’ for a pro-life bill which I co-sponsored. In many ways we are running out of time to move these measures forward, but we are working late into the evenings to accomplish as much as we can. 

Please contact me if you have any questions or concerns at mdorn@leg.ne.gov, 402-471-2620. Thank you.

The Legislature has completed 44 of the 60 days allotted for this session. With so many pressing issues, it could be argued we couldn’t afford to lose an hour of debate time.  So quite appropriately, we began the week by taking up a bill concerning Daylight Saving Time (DST). When I was first elected, my wife indicated I should do something about this issue. She is not alone in this; changing the clock twice a year generates a great deal of communication to all the senators, from all sides of the issue. Sometimes the ‘internal clock’ doesn’t change as easily as the one on the wall.  Younger people adapt more quickly, those older or with a more rigid routine may adapt less easily. 

Sen. Briese of Albion has introduced bills every year on DST, and this year made it his priority. During a brief discussion on the floor, Sen. Erdman, from the Panhandle area, suggested keeping standard time all year as well as combining all of Nebraska into one time zone. However, the bill advanced to the next round of debate by a wide margin without amendments. Then surprisingly the next day, the U.S. Senate passed a measure to maintain DST all year by unanimous vote, a rare occurrence. So in the end, Congress may end up doing the heavy lifting on this bill and it could come about quicker than we thought. 

After that fast start to the week, the process slowed down to talk through the budget.  You can find the entire budget document on the homepage of the legislative website, under “recent legislative information”, about fourth in the list. www.nebraskalegislature.gov

In the first year of our two-year biennium, seven bills were used to complete the budget. In this second year, we have just three bills, to make adjustments to that main budget passed last year. LB 1011 modifies appropriations from last year for specific programs and agencies. 

LB 1012 takes care of fund transfers and includes some of the big proposals such as the “Star Wars” water and tourism bill, the “Perkins County canal”, and so on. This bill was filibustered by Sen. Lathrop and some other senators who want criminal justice reform, or because they do not see the need for a new prison. LB 1012 sets aside $175 million for building a prison, but would need future authorization for these funds to be used. We need to wait on that until more information about prison sentencing reforms, construction projections and location comes in, which may not be available until August.  

The third budget bill, LB 1013, makes changes to the cash reserve (or “rainy day”) fund. Last year the amount in reserve was $700 million to $800 million.  This year we started at $998 million, and now with our strong economy and the federal funding flowing into Nebraska, we sit right at $1.7 billion. A previously unheard of number. Some of these funds will be expended for specific projects. 

After approving the budget bills, about $450 million will remain available for bills pending on the floor. Every day, the legislative fiscal office puts together a running total of how much of that has been “spent”.  The funds might be allocated to an actual program, or it can mean the amount is decreased by tax cuts, which lower the amount of available revenue to the state. Either way, I firmly support leaving that cash fund in a strong position going forward when changes in the economy inevitably occur.

As I mentioned, Sen. Lathrop of Ralston led the discussion on criminal justice reforms in sentencing, parole, and so on. A judicial study completed last year produced more than 20 recommendations and some of those were included in his bill, LB 920. Sen. Wayne of Omaha argued the state should be investing in areas like census tracts in North Omaha, especially if there were funds for prisons, recreational lakes and other proposals.

As a member of the Appropriations committee, I heard the testimony on all of these funding requests. Our task was then to decide on the best use of both state and federal money and the merits of projects all across the state. We had more full day hearings than ever before and listened to a vast range of needs and reasonings for a share of the dollars. We had to look at the big statewide picture and how that would play out over time.  We will find out over the next five years if it was done well, and what needs still exist.

I also want to emphasize the difference between the state’s general budget and the bill we will debate next week on American Rescue Plan Act (ARPA) requests.  From the 84 bills asking for one time federal ARPA funding, the Appropriations committee combined about 40 of those together in one bill. That ARPA package has been unanimously designated a speaker super priority by the Executive Board of the Legislature, giving the Speaker the ability to control the order of amendments taken up, and the amount of time spent on each amendment. 

Please continue to contact me at mdorn@leg.ne.gov or call 402-471-2620. I look forward to hearing from you and discussing your concerns.  Thank you. 

All day debate has begun in the Legislature, and several high profile bills were discussed on the floor, one of which was LB 773 about concealed carry requirements. The first step in taking up this bill, introduced by Sen. Brewer, who chairs the Government, Military and Veterans Affairs committee, was to pass a motion to pull it from committee. After about an hour of discussion on Tuesday, the motion passed. Debate on the actual bill began on Thursday. LB 773 would prohibit cities, counties and villages from regulating the ownership, possession and transportation of concealed handguns. Individuals who are already prohibited from possession of a gun would still be barred under this bill; as would carrying while under the influence, carrying in schools and certain government premises, and private businesses that have such rules in place.

When the bill was heard in committee, both Lincoln and Omaha Police Departments opposed the bill. Since then, OPD worked with Senator Brewer who has offered an amendment which made it more workable for them. After eight hours of debate, there were 36 votes to invoke cloture (meaning all debate ceases). The vote to advance the bill to the next round of debate was 35 for, nine against, four not voting. I am a co sponsor of LB 773 and voted in favor of advancement.

The Appropriations Committee has completed work on the general fund budget, which will be printed and distributed for senators to review in preparation for debate next week by the full legislature. As a committee, we will continue to meet in executive session over the noon hours again next week; this time to work on the federal American Rescue Plan Act (ARPA) funding coming into Nebraska.

One major recurring budget item is corrections. The overall goal in our prison system is to rehabilitate the people coming into the system so they can be released. Nearly 95% of all people incarcerated will return to society. LB 896 was introduced by Sen. Lathrop to require an evaluation of programming and treatment in our prisons. The study, conducted by an educational institution, would give the Legislature a better understanding of how the state is doing with persistent overcrowding, provide a cost-benefit analysis and rate the effectiveness of existing programs. As we know, both the pandemic and staffing issues have really been challenging in the past couple of years. Helping inmates get necessary programming, training and education, visitation and so on, is key to reducing recidivism, and establishes a solid foundation for a ‘second chance’ after being released.

A new prison is part of the Governor’s budget proposal. The Appropriations committee did set aside another $175 million for this purpose. Along with the $65 million we put aside last year, there is funding sitting in an account – but without the specific authority to build, which would still need approval by the Legislature. If the decision is made, the funding is there. As Senator Stinner points out, just constructing a new prison facility does not solve the significant overcrowding problem in Nebraska. You cannot build your way out of overcrowding, you have to look at the complete package of sentencing reform and programming for inmates as well.

About six to eight years ago, some reforms were passed, with the idea of reducing the number of inmates; however it only stabilized numbers of those incarcerated. Sometimes the best intentions of enacting strict sentences do not have the desired effect and result in more prison overcrowding. I believe we need to work in tandem on these two: site construction and responsible sentencing reform. I do not see successful passage of either measure without tackling both in the same time frame.

Another bill which advanced out of the Health and Human Services committee would look at ways we can improve our child welfare system. This would include bids, the appeals process, contracting and delivery of services; and how various branches of government work together to help families, children and providers within the program. We know there is much we can do to make this better for the children who need this system and the support.

To find the details on every legislative bill, the calendar and contact information, go to www.nebraskalegislature.gov. Contact me directly at 402-471-2620, mdorn@leg.ne.gov. You can also follow me on Facebook, and listen to my weekly report on Friday mornings at 8:30 am on KWBE radio.

This week at the Capitol, we held the last of the committee hearings on new bills introduced in January. Committee work will continue in executive sessions until a decision on each bill is made. The options are to move a bill to the floor for debate, hold it in committee or kill it. At this point, only those bills which have been prioritized stand a chance of being discussed by the full legislature, but the committees will still finish their duties. 

The Appropriations Committee will be working on the final budget proposal for the General Fund, to get that out to the floor by Day 40 (Friday, March 11). Then we will have a few more days as a committee to finish up our recommendations for using the American Rescue Plan Act (ARPA) federal funds. These two packages are prioritized and will no doubt generate substantial debate on the floor.

The Nebraska Economic Forecasting Advisory Board (NEFAB) met on Monday and released their projections of where revenue will be in the next four months, taking us to the end of the fiscal year on June 30, 2022.  Their analysis was based on what we have seen the past six to 12 months, as well as prior years, and once again, the forecast was higher. The increase in the FY 2021-22 forecast is considered “above certified” and will be transferred to the Cash Reserve Fund, or “rainy day fund”, bringing the projected balance to $1.713 billion based on the Appropriations Committee preliminary budget. 

There are some revenue measures, bills passed on the floor and other appropriations which will reduce that $1.713 billion figure, but for purposes of comparison, the rainy day fund had never before been above $760 million. When I first took office in 2019 it was in the range of $300 million. This is one indicator of how much federal funding has affected the state, and the strength of Nebraska’s economy.  Almost $24.1 billion non-traditional federal dollars came into Nebraska dealing with the covid situation, which is 22% of 2021 total state personal income.  

In other words, around one-fifth of our personal income in the report could be attributed to the federal funds allocated due to Covid-19. While this helps explain some of the high state revenue growth, it also reminds us that over time the federal money disappears. 

In the Appropriations Committee, we continue to deliberate about how quickly income and revenue might decline in the future or if levels will remain steady for a period of time. Of particular concern is the fact that FY21 and FY22 show the highest and third highest adjusted revenue growth since 1982; yet the low revenue growth years which have always followed the peaks are not yet known.  The forecasting board will meet again in the summer and fall, and those projections will be used to create a new biennial budget in January of 2023.

During morning sessions, we moved a fair number of bills along in the process in the past few days. Most of these were non controversial issues with simple amendments. All of that will change next week as we discuss more high profile issues, including LB 773, a concealed carry bill introduced by Sen. Brewer, the “Star Wars” bill which concerns water projects, and the Perkins Canal proposal by the Governor.

A constitutional amendment was one of the issues voted to the next round of debate, LR 282CA. This measure would be especially beneficial to small and medium sized airports in the state, and allow use of revenue to develop or expand regular commercial air service, including LNK, Lincoln’s airport. Most states do allow this, and several senators commented on how important this is to economic growth and attracting both new business and new residents to our state. 

One of the bills we advanced this week could affect both District 30 and District 32. The bill would allow Nebraska to compete for selection as one of four regional sites for a “clean hydrogen hub”, resulting in jobs,  economic development and potentially some spin-off business. As introduced to the Natural Resources Committee, the bill cites our state as a prime location, thanks to our electric generating capacity and transportation infrastructure. Monolith, located near Hallam, already has an established presence in this industry and is looking to expand.  

Speaking of neighboring District 32, after the filing deadline on Tuesday, only two legislative seats are uncontested among the 24 up for election – Sen. Tom Brandt’s of Plymouth, and mine. It is humbling and gratifying to think the people of District 30 feel I am helping in some way; and I am very thankful for that. I look forward to seeing what more can be accomplished in the next four years.  I always appreciate hearing from you. Contact me at mdorn@leg.ne.gov or call 402-471-2620.

The last full week of February was definitely a full week of legislative business, and marked the halfway point of the session. We welcomed a new member of the Legislature, Mike Jacobson of North Platte, who was appointed to represent District 42 upon the resignation of Mike Groene. Sen. Jacobson grew up on a farm in south central Nebraska and is in the banking industry. It is important to have a voice for every legislative district in our one-house Unicameral, so it was essential that the Governor act quickly with his appointment. 

We have a policy and process to handle informal and formal complaints in the Legislature. The chair of the Executive Board, Sen. Hughes, has appointed three senators to oversee the issue regarding former Sen. Groene:  Sen. Arch of Omaha, Sen. Briese of Albion, and Sen. Wishart of Lincoln with the authority to hire outside legal counsel.. The State Attorney General and the Nebraska State Patrol will also investigate. 

My final two bills had their hearings this week, LB 996 and LB 760, both in front of the Appropriations Committee.  LB 996 was brought on behalf of assisted living and nursing homes, to use American Rescue Plan Act (ARPA) federal funds to help catch up just a bit with costs incurred during the pandemic.  It would direct just over $5M, or $400 per licensed bed, to these types of facilities for recruitment, retention or pay for staff, or go towards the supplies and equipment needed for disease control. Practically every nursing home in the state was greatly impacted by Covid-19. In talking with Jeff Fritzen at Gold Crest in Adams, you find out just what they had to do to comply with federal covid protocols and the extra costs that created, while receiving no rate increase from medicaid during that time. Some of our elder care facilities are struggling to stay afloat and we know some have recently closed. Hopefully this bill can become part of a package of ARPA funds and help in getting past these problems.

LB 760 allocates $5M in ARPA funding to Emergency Medical Services (EMS) programs across the state, for ambulances and life saving equipment. The Governor also had $35M specifically for ambulance purchases for rural squads in his ARPA proposal. Just like nursing homes, these volunteer units in our small towns were greatly impacted by covid, with an increase in calls and strict protocols that had to be followed. We heard testimony from several rural crews who serve stretches of the interstate or state recreation areas. So the impact is not just rural, it is for anyone in the area at the time who needs emergency services.  As you probably know, I’ve been a volunteer on the rescue squad at Adams for over 35 years and saw first hand the challenges with the pandemic. I will work to secure some level of funding to help out these vital services in our communities. 

This week was our deadline to designate a priority bill. Each senator can name one, each committee can select two, and the Speaker can list up to 25.  I chose LB 1261, which was introduced by Sen. Murman, who represents the southern tier of counties in the south central part of the state. This bill amends the existing Nebraska Advantage Rural Development Act, to raise the ceiling of credits from approved projects to $25M a year. The refundable credit against taxes would promote investment in livestock facility modernization or expansion. It would have a definite impact in rural areas, and help create opportunities for more young people to stay on the farm. This request came from the dairy industry, along with the beef, pork and poultry industries.

We often talk about how crucial it is to keep people in Nebraska, enhance our workforce and energize our small communities and rural areas. We also know the agricultural industry is related to one of every four jobs across our state. It is my hope this measure can help young producers have the chance to expand their operations, and make their farms and ranches profitable and desirable places to raise a family. I want to see viable farms continue to fuel employment. This issue is very important to me, and to the vitality of our state’s economy, so I made it my priority bill. It will be the last bill to be heard by the Revenue Committee for the year, and it is not yet voted out of committee. I looked at several bills that affected rural Nebraska, but this one rose to the top.

After spending most of our floor debate this week on LB 939, the bill did advance. It would reduce the top individual state income tax rate from 6.84% to 5.84% by 2025. We had a good discussion and stayed on topic for the most part, and were able to hash out some changes that could improve the bill.  I am not ready to comment on that until I see the wording of possible amendments; but there were many side conversations about how to make this bill better and the other tax issues that might be included in this bill.

Please contact my office at any time at mdorn@leg.ne.gov; call 402-471-2620; send mail to PO Box 94604, Lincoln, 68509-4604; and check out the website at www.nebraskalegislature.gov. Thank you.

We are very close to the mid point of the session, but we certainly are not ‘half done’ with debate on the floor. If you have watched any of the session it might appear that we are not progressing through the agenda very quickly. (Note: you can watch live if your cable station carries it, or you can find a link to watch via the internet on Nebraska Public Media. Click on their blue logo on the right side of the Legislature’s website at www.nebraskalegislature.gov)

As you know, we have already discussed some big issues. There are good reasons not to rush through complicated bills with far reaching effects. A “filibuster”, which can consume eight hours of debate on the first round, is actually when much of the hard work is done. Many times that is when side conversations take place and explanations are made more clear. There are often negotiations and adjustments, resulting in amendments. And that can be the difference between a bill passing or not.

The Appropriations Committee on which I serve, is working through the regular general fund budget adjustments as well as the federal funding requests from the American Rescue Plan Act (ARPA). The general budget adjustments are due to be reported out from our committee on day 40. The adjustments to this second year of the budget will rely on the analysis from the Nebraska Economic Forecasting Advisory Board, which meets on February 28th.  We will also use those projections for the budget that impacts our next fiscal year, which starts on July 1st. 

The nearly 100 bills requesting ARPA funds are taking a lot of time to work through. The chairman has grouped similar bills together in hearings, for example Thursday was University of Nebraska day as eight ARPA bills were heard in committee.

I presented several bills in committee again this week. The first was LB 761, heard by the Transportation and Telecommunication Committee, which handles broadband legislation. The bill creates the Precision Agriculture Infrastructure Act, funded by ARPA dollars, to help set up points for wireless infrastructure in rural areas that lack good broadband coverage. Grants would go to broadband providers offering on-farm structures and devices; and to producers, cooperatives, or agronomists to help with practical uses. Today’s farm and irrigation equipment is increasingly dependent on digital applications that require a real-time source of connectivity. We also know this technology will keep expanding in years to come and we need to be ahead of the curve.

LB 968 was brought to me by several non-profit organizations to use ARPA funds to develop affordable housing including accommodations for vulnerable populations like refugees and immigrants. LB 968 also includes funds for job training for refugees. The state of Nebraska has already taken in 5000 people from Afghanistan, who have 90 days to get established, get an address and so on. 

We had a gentleman from Afghanistan testify in support of LB 968 who had worked as an interpreter for the US military there, was in danger because of that, and was removed to the US for the safety of him and his family. We also had two gentlemen come in from Somalia who fled the wars there and resettled in Nebraska.  These people represent the huge need, but also a great opportunity for Nebraska businesses who are really struggling to find employees.

You may remember that just one year ago, we had the coldest temperatures of the season, falling to 30 below. I introduced LB 969 to get ARPA funds to support and improve the reliability and resiliency of the electric grid in Nebraska. Public power agencies across the state are asking for help with maintenance and improvements they haven’t been able to do because of the pandemic and severe weather events, with the hope of preventing failures and “rolling blackouts” in the future. 

The Appropriations committee heard my LB 904 on Thursday as part of that slate of bills related to the University of Nebraska statewide system. LB 904 deals with cybersecurity and  would create a national complex for digital dependability. In the past couple of years we have seen hackers disrupt meat packing and ag cooperatives, schools, hospitals and even the city of Beatrice. We need to be prepared in Nebraska with a facility and experts to get us ahead in cybersecurity; we are all too aware this will continue to become more and more of an issue. 

On the floor this week, I voted to advance LB 906, introduced by Sen. Ben Hansen. The bill would create a way for people to claim a religious or medical exemption for coronavirus vaccinations. I visited extensively with people in the medical field, and heard from many constituents in District 30. The views on this issue are quite divided. As an example, I heard from one parent who said their children would not attend a school with a mandate, and another parent who was happy a mandate was in place or they would not have sent their children to school there. This bill does give people some options. 

We will continue to discuss LB 939, as introduced by Sen. Linehan in the coming week. This measure would reduce the state Income tax top rate from 6.84 percent to 5.84 percent over 3 years. In general, I agree a tax cut will spur economic activity – when people have money to spend, they will spend it. Sitting on Appropriations, I know the “rainy day fund” has never been higher and the state is in the best financial shape we have been in for years. But I have to ask if we will be in the same positive situation in three to five years when the revenue reductions kick in and the federal money dries up and the economy changes, as it always does. These are crucial considerations and I am listening to the debate and studying this issue. 

Your communication is as important as ever as we go through the session. Please reach out at:  402-471-2620 or mdorn@leg.ne.gov.  Thank you.

The Legislature continued this week with a schedule of morning debate on the floor, and afternoon committee hearings. I had three bills heard in committee this week, LB 759, LB 1090 and LB 1091.

LB 759 addresses the microenterprise loan program, which is part of the Business Innovation Act (BIA).  This program began in 2011 to award loans to small businesses. The original amount back then was $50,000; it was raised to $100,000 in 2015.  My bill would raise that cap to $150,000 in an effort to account for cost of living changes, the current business climate and inflation and get those funds out to the people who really need it and can use it to contribute to our local economy.  This program works well for those who might not fit a typical bank loan. The entrepreneurs and start ups in the program have nearly always been turned down by traditional lenders, and this can fill a financing gap in the community. BIA also provides technical assistance and helps these innovators develop the credit history they will need to become bankable going forward. 

I also introduced LB 1090 to resolve an issue in a positive way with the Business Innovation Act (BIA). This bill increases the annual cap of the amount of funds to be awarded for microlending and technical assistance. Last year, the Legislature passed LB 380 which capped small business investment at 20% of the BIA budget appropriation, amounting to about $2 million for microlending. That created a ‘math problem’ that needs to be remedied. With an appropriation of $13.7 M this year, and $14.7 M for FY 22-23, a cap of just two million dollars would prohibit full use of the intended 20% for small businesses. Increasing the cap from $2M to $3M allows BIA, through the Department of Economic Development, to fully fund small business investment and assistance.

The third bill, LB 1091, was heard by the Health and Human Services Committee. This bill was brought to me by Nebraska nurses and hospitals, as part of a group of bills designed to help with the healthcare staffing crisis in our state. A study done last year shows we will have a shortage of over 5,000 nurses in just three years. We all know how important high quality and readily available health care can be for a community. This bill would allocate $5 million from the federal American Rescue Plan Act (ARPA) to provide scholarships for nursing students. The requirements include being a resident of Nebraska, enrolling in an approved program, and the intent to work in nursing for two years in our state when education is complete. My hope is to keep our healthcare workforce as strong as possible going forward.

Much of the debate on the floor this week has centered around school finance, with a measure to cap spending in LB 986 by Sen. Briese, modifying state school financing in LB 890 introduced by Sen. Walz, and a separate  companion funding bill from Sen. Lindstrom, LB 891.  

Like a similar measure for a 3% cap on school spending in last year’s session, LB 986 didn’t get enough votes for cloture, so will not proceed. While discussion did go the full eight hours allotted, I did appreciate the explanations of how it would affect schools, property tax, and the reasons for the bill. Many of our school districts are controlling spending and those local school boards are doing their job well. That bill had a cap of 2.5% and we have many schools below that.  Generally speaking when a school has a high increase in spending, there is a reason why.  Lincoln Public Schools over the last five years has had a 7% increase in spending; but they also have new school buildings to staff and a growth in student population.

In Nebraska, we have strong support for local control: we have local schools boards and there are local elections for those boards. You have an opportunity at your local level to get involved, to see what is going on. You can ask your elected officials at the local level why they voted a certain way. So right there we have an opportunity to help control spending. I did vote against LB 986. My vote was based on my experience of sitting on the county board. A cap can have an inverse effect, it can actually encourage a board to go up to the maximum allowed by a cap so they don’t risk losing money in future years. Generally, the cap doesn’t do what you want. It rewards those who have spent too much, as they are now starting at a higher level. Those who spend less start at a lower level and lose out. The result is that a cap can have a negative impact on the intent of keeping taxes lower; and in LB 986 it could have increased spending in some school districts.

Taxes and K-12 school funding debate continued when we took up LB 890. The funding arm to implement this is addressed in LB 891. One good aspect of separating the matter into two bills:  it allowed one to be heard by the Education Committee and the other by the Revenue Committee.  At this time, I cannot support LB 890, there are too many winners and losers without guarantees for the funding of all schools across the state. Since long hours had been spent on this without any consensus, Speaker Hilgers used his authority to put a ‘speaker hold’ on the bill and debate has stopped for the present time. 

In the meantime, make sure you get credit for your property taxes. Under LB 1107 passed last year, property tax payers are eligible for the income tax credit refund for school property tax paid. This year the level is 25.3% of the school property taxes you paid in 2021, so be sure to file for that and get that refund. Last year it didn’t all get used, so be sure to apply that on your income tax return.

Please continue to contact my office if you have any concerns or questions. mdorn@leg.ne.gov  402-471-2620. Send mail to District 30, PO Box 94604, Lincoln, NE 68509-4604. These are the best ways to contact me, and I appreciate hearing from you.