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On Thursday, January 13th, Governor Ricketts presented his final State of the State Address to the Nebraska Legislature. The Governor emphasized his message over the past 8 years has been to Grow Nebraska. He reported that this has happened, despite floods, fires, and a global pandemic. He touched on his priorities for this year, which include tax relief, strengthening public safety, and investing in natural resources. He endorsed legislative proposals to accelerate the phase-out of taxing Social Security benefits, to place a cap on annual increases in property taxes, and to reduce the top individual and corporate income tax rate.
The governor highlighted his recommended adjustments to the 2021-23 state budget as well has his suggestions for spending the American Rescue Plan Act (ARPA) money. Included in his recommendations, is $150 million from the General Fund and $50 million in ARPA funding for the Statewide Tourism and Recreation Water Access and Resource Sustainability (STAR WARS) program. Through the passage of LB 406 last year, a consultant was hired to study three areas of the state – the Lower Platte River Area, the Lake McConaughy Area, and the Niobrara River Area. Pertaining to the northeast Nebraska area, the consultant recommended constructing a new boat launch near the Village of Niobrara, expanding the Weigand Marina, and building a new Event Center and Lodge at Niobrara State Park. The total funding recommended was $86.7 million. We are working with the Ponca Tribe and the Nebraska Game and Parks Commission to assist in funding this exciting project.
Also included in the Governor’s recommendation was $60 million to restore and protect drinking water systems in rural areas across the state, such as Cedar and Knox Counties. I had been working with the Lewis and Clark Natural Resources District on needed improvements to ensure the sustainability of a long-term water source.
This past week, the Legislature discussed several major issues carried over from last year. One was the inheritance tax. Nebraska is one of only six states that currently impose an inheritance tax, but the only state where the counties receive the revenue. If this tax were eliminated, property taxes would likely increase in a number of counties. As amended, LB 310 received first-round approval on a 41-4 vote, after the Nebraska Association of County Officials agreed to the committee amendments, if further attempts to completely eliminate the tax were dropped. As amended, the rates are decreased and the exemptions are increased from the current amounts. These changes bring Nebraska more in line with other states that have the inheritance tax, without reducing county revenue too drastically.
With a 32-10 vote, lawmakers gave first round approval to LR 14, the legislative resolution that proposes to apply to Congress, under Article V of the U.S. Constitution, to call a convention of the states, which would be limited to proposed amendments dealing with fiscal restraints on the federal government, limiting the power and jurisdiction of the federal government, and term limits for officials and members of Congress. To meet the constitutional requirements to convene a Convention of States, 34 states would be required to call with matching resolutions to LR 14. Fifteen states have already utilized this opportunity and a resolution is pending before an additional 26 states. For any proposed amendment resulting from a Convention of States to officially become an amendment to our Constitution, it must be ratified by 38 states.
LB 364 proposed to adopt the Opportunity Scholarships Act. Taxpayers could claim a nonrefundable income tax credit of up to 50% of their state income tax liability on contributions they make to nonprofit organizations that grant scholarships to students who attend private schools. The scholarships would be directed to new students, who qualify for free and reduced priced lunches. Under proposed committee amendments, the amount of credits would be limited to $5 million in any calendar year. LB 364 failed to receive enough votes to invoke cloture last year and fell to the same fate this year, after an attempt was made to end the filibuster.
If you have any comments on the Governor’s proposal or on any of the bills introduced so far this legislative session, I encourage you to contact me with your thoughts and opinions. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My telephone number is (402) 471-2801 and my email address is email@example.com.