NEBRASKA LEGISLATURE
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Sen. Steve Halloran

Sen. Steve Halloran

District 33

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To mix things up a bit, I am going to lead off with events that happened outside of Lincoln.  Monday I had the pleasure of meeting with the good people of Nebraska.  My first meeting of the day was with the National Active and Retired Federal Employees Association in Grand Island.   I thoroughly enjoyed my visit with these folks.  After a brief review of current legislative activity, we engaged in a lively   Q & A.   Much of the questioning centered around the significant tax impact on fixed income of retirees.  I also shared with them some detail regarding my priority bill, LR 6, calling for Nebraska to join in an Article V Convention of States. The group was very interested and engaged in some thoughtful discussion.

Later in the afternoon, my Legislative Aide and I attended a town hall style meeting with the Junior and Senior students from the Wood River High School – the home of the Fighting Eagles.  The meeting was held in their beautiful auditorium.  Students studying Political Science were tasked with researching a current legislative bill of their choice.   They were assigned to study the bill and follow its progress through the session.   After a very nice introduction, students were encouraged to go the mic and ask questions about their particular bill.   Many of these bills were not specific to my committees so, with the assistance of my Aide, I did my best to answer their questions.  I was very impressed by the whole event.  I was first and foremost impressed by the students.  Likewise, I was also impressed with the school’s faculty and their interaction with their students.  It is clear to me that Wood River, Nebraska has a bright future.  These students were the consummate professionals – they were educated, prepared, and polite.  I was also impressed with the structure and concept of holding a town hall meeting for high school students.  They are learning how to be actively engaged in their responsibilities as citizens to their local community and state.

Tuesday marked the start of 3 late night sessions in a row. The first night focused on LB461, the Governor’s and Revenue Committee’scomprehensive tax plan.  For the first time in many years, the Revenue Committee advanced a comprehensive vision for tax reform in Nebraska. Legislative Bill 461, the Nebraska Taxpayer Reform Act, was intended to rein in high property and income taxes on families, farmers, and businesses across the state.

The bill had two major components.  One component dealt with changing the methodology for measuring valuation of farmland for property tax purposes.   Historically, land valuation has been based upon the recent history of land sales in the community.  Instead, this legislation would create a methodology for measuring valuation based upon the income-producing history, using an 8 year Olympic average, dropping the high and the low.   This was not designed to give quick property tax relief.   Over time, this would at least allow farmland valuation to “float” with the commodity markets….avoiding the squeeze landowners are experiencing now trying to pay high property taxes with low commodity prices.

The second component of the bill focused on reductions in income and corporate tax rates.  These small incremental reductions in tax rates would be triggered only when there is a 3.5% or more increase in projected revenue to the state.   The bill was far from perfect.  I voted for this legislation to advance it to ‘Select File’ for further amending and debate.  Unfortunately, the bill’s sponsor failed to motivate enough support to give some hope for some tax relief and the bill failed to pass.

LB98, which would have extended certain levy authority for NRD’s, was also heavily debated.   LB98 would have given a 10 year extension of the sunset date of the 3-cent property tax levy for fully appropriated NRD’s.   I did not vote for cloture on this bill.   This did not impact our NRDs, but it would have potentially increased property taxes for others.   I could not bring myself to raise someone else’s property tax.

On Wednesday the majority of the day and night’s debate was on the mainline budget – LB327.   The focus of the debate was not on overall spending but rather on a small provision of the bill dealing with the prioritization of which facilities would receive Title 10 Federal funding.   There was a lot of misinformation and hyperbole about this issue.   Ultimately, an amendment offered by Appropriation Committee Chair Senator Stinner pulled the controversial provision from the bill and this appropriation bill was passed onto Final Reading.

We have a long way to go before we pass the final biennium budget for 2017-2019.  The Appropriations Committee has been meeting 5 days a week, since the beginning of the session to work through nearly a billion dollar shortfall in revenue.  I am troubled that, to make the numbers work, this committee has proposed pulling funds from a number of agency funds and to draw significantly on the “rainy day fund”.  In addition, I am concerned that this next biennium budget is built on a false premise…..namely, an overly optimistic increase in state revenue.   In spite of this last year’s tax revenue income growth being a little south of 1%….this committee is projecting an increase of 5% in tax revenue.  This state’s economy is highly dependent upon our great Agriculture industry.  The folks in Lincoln and Omaha are a bit clueless about commodity prices and rural property taxes.  If they had a better grasp of economic reality, they would lower their expectations for state revenue.

Late into the night on Thursday we continued our debate on LB44 the “Internet Sales Tax Collection.”  I conceptually support the premises behind the crafting of this bill.   I believe that we should have a level tax playing field. All goods purchased for consumption in Nebraska should have the same tax levied on those goods regardless of how they were purchased.  The issues I have with the bill are to do with the constitutionality and the mechanisms used to collect these taxes. The bill needs much more refinement to become a functioning law. Debate ended without a vote, essentially the bill is dead for this session.  Senator Watermeier the Chair of the Executive Committee, the bill’s sponsor, said he did intend to bring the bill back next year.

Sen. Steve Halloran

District 33
Room #1306
P.O. Box 94604
Lincoln, NE 68509
Phone: (402) 471-2712
Email: shalloran@leg.ne.gov
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