NEBRASKA LEGISLATURE

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Tim Gragert

Sen. Tim Gragert

District 40

The content of these pages is developed and maintained by, and is the sole responsibility of, the individual senator's office and may not reflect the views of the Nebraska Legislature. Questions and comments about the content should be directed to the senator's office at tgragert@leg.ne.gov

The Legislature gave second-round approval to the budget bills this past week, working late each evening. This will allow the budget to be read on Final Reading next week, meeting the requirement to have it passed by the 50th legislative day. The budget provides funding to cover salary increases recently negotiated with the union and the state for employees at correctional facilities and other 24/7 facilities that were experiencing dangerous staffing shortages. Worker shortages and competition also necessitated provider rate increases for nursing homes, behavior health providers, developmental disability providers, and juvenile justice providers. Very few adjustments were made to the Appropriations Committee’s recommended budget.

The Appropriations Committee also submitted their recommendations for spending the federal American Rescue Plan Act (ARPA) funds in the committee amendments to LB 1014. LB 1014, as introduced, contained the governor’s proposals for spending the $1.04 billion in federal funding resulting from the COVID-19 pandemic. The majority of the recommendations from the committee mirrored the governor’s suggestions. Both the governor and the committee recommended $100 million in funding for shovel-ready capital projects, funding for workforce housing, workforce development in community colleges, assistance to small and medium meat processors, and funding for a Rural Health Complex at UNK.

Unlike the Governor, the Appropriations Committee recommended $55 million for competitive wages for providers of developmental disabilities services similar to the pay rate for State of Nebraska employees who recently received a significant raise due to severe staff shortages. Furthermore, $55 million was recommended for supplemental incentive payments for direct care staff employed at licensed and Medicaid-certified nursing home facilities. The Appropriations Committee also included $150 million for qualified census tracts, to be used for entrepreneurship, housing, employment, job creation, and small business assistance. This is meant to help North and South Omaha.

Since there is a set amount of federal ARPA funding, the Speaker of the Legislature required senators offering amendments to LB 1014, to also specify which program(s) would be cut in order to fund their proposal. Only a couple of amendments were successful, adding funding for additional mental health care capacity, nurses scholarships, and loan repayments for health professionals.

I was able to obtain $7 million in ARPA funding for the Cedar Knox Rural Water Project through a successful amendment to LB 1014. The Governor had included $60 million for drinking water projects in his recommendations, even mentioning the Cedar Knox Rural Water Project in his State of the State address. However, the Appropriations Committee did not include it in their recommendations, but did work with me on finding a revenue source for my amendment. The Cedar Knox Rural Water Project is overseen by the Lewis and Clark NRD and has over 900 rural service connections, serving two SIDs, three housing developments, five campgrounds and four communities – Crofton, Fordyce, St. Helena and Obert. This regional system treats surface water from the Lewis and Clark Lake. However, the intake structure is expected to be inundated by sediment in approximately 20 years and the approaching sediment is causing an increase in organic material drawn into the intake that must be treated. Furthermore, production capacity of the treatment plant and portions of the distribution system are at or near their maximum sustainable levels. This funding will be used to assist with the cost of developing a groundwater source and a treatment plant. I emphasized to senators the importance of having an adequate drinking water supply prior to potential increased population and infrastructure due to the exciting STAR WARS project proposed in northern Knox County.

LB 933, introduced by Senator Joni Albrecht, would prohibit abortions in Nebraska if Roe v. Wade is overturned this summer by the U.S. Supreme Court. A public hearing was held on LB 933 before the Judiciary Committee on February 24. However, the bill is stuck in committee, without enough votes to advance. I, along with twenty-two of my colleagues, signed on as a co-sponsor of this legislation. Speaker Hilgers has designated it as his priority bill. On March 25th, Senator Albrecht offered a motion to pull LB 933 from committee and place it on General File. Her motion was successful.

As we enter our final weeks of this legislative session, I encourage you to contact me with your opinions on the legislation before us. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is tgragert@leg.ne.gov and my telephone number is (402) 471-2801.

We change our clocks twice a year, switching from standard time to daylight saving time and back again, even though we may not like it. This could soon change. The Legislature gave first-round approval to LB 283 which would keep daylight saving time year-round, if given approval on the federal level and three adjacent states adopt similar laws. To date, Wyoming has passed this legislation and the proposal is pending in Colorado, Iowa, and Missouri. In total, 18 states have passed bills to switch to year-round daylight saving time and an additional 27 states are considering it. Furthermore, on the federal level, the Senate approved a measure with bipartisan support that would make daylight saving time permanent across the United States next year. The proposal now goes before the House of Representatives.

Under current federal law, states are allowed to keep standard time year-round or change their clocks twice a year. However, the sponsor of LB 283, Senator Tom Briese, stated that he initially attempted to propose standard time year-round but ran into much opposition from retailers, chambers of commerce, and the recreational industry, who prefer longer daylight. Supporters cited many reasons to end the practice of changing our clocks, such as difficulty in getting children out of bed for school, disruption of medication schedules, reduced economic activity, health reasons, and even increased car accidents.

The Appropriations Committee presented their budget proposal to the Legislature and we spent most of this past week debating it. The state’s financial status has significantly improved since the Legislature passed the biennial budget last year. Since last session, more than $2 billion of additional revenues have affected the budget. Of this amount, $611 million is retained in the General Fund and $1.445 billion was transferred to the Cash Reserve Fund, as required by law. With the addition of unused appropriations from last fiscal year, it resulted in $775 million in available funds for this biennium. The Appropriations Committee utilized $349 million in their budget recommendations, leaving $454 million in available funding for tax cuts or increased spending. Of the $349 million utilized by the committee, 75% went to employee salary increases, provider rate increases, and support for the STAR WARs proposal.

Much of the debate on the budget bill adjustments focused on correctional issues. The Appropriations Committee’s recommendations include a $175 million transfer from the cash reserve fund for a new $270 million, 1,512 bed correctional facility to replace the aging Nebraska State Penitentiary. However, their recommendations do not include the appropriation authority to expend these funds, requiring further action by the Legislature. The chair of the Judiciary Committee strongly believes that criminal justice reform needs to take place prior to discussion of prison construction. Without changes in parole or reduced sentencing for some crimes, even with the new facility, it is projected that our prison system will be overcrowded by more than 1,300 inmates by 2030. Nebraska tops other states in having the most overcrowded prisons.

I want to inform high school students who have an interest in law, government, leadership, or public speaking, of the 2022 Unicameral Youth Legislature. It is a four-day legislative simulation held at the State Capitol from June 12-15. Student senators will sponsor bills, conduct committee hearings, debate legislation, and learn about the unique process of our unicameral system. UNL’s Extension 4-H Youth Development Office coordinates housing and recreational activities for the camp. Registration forms can be obtained at https://nebraskalegislature.gov/uyl. The scholarship application deadline is April 5.

Again, I encourage you to contact me with your thoughts on legislation that is before senators. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is tgragert@leg.ne.gov and my telephone number is (402) 471-2801.

A new event center and lodge at Niobrara State Park, a new boat launch near the Village of Niobrara, and expanding the Weigand Marina at the Lewis and Clark State Recreational Area, are one step closer to reality, as the Legislature gave first-round approval to LB 1023 on a 29-4 vote. LB 1023 carries out the recommendations of the State Tourism and Recreational Water Access and Resource Sustainability (STAR WARS) Special Committee, of which I am a member. The bill also includes funding for road improvements and a new marina at Lake McConaughy, as well as a new lake between Omaha and Lincoln. All discussion pertaining to the improvements in Knox County were favorable, noting the natural beauty of the area and agreeing that we need to attract more people. There were many questions asked on the proposed 4,000 acre lake, such as the projected costs, whether Lincoln’s drinking water would be affected, and the process that will be used to purchase the land. It was estimated that the proposed lake could cost up to $1 billion, but that private-public partnerships would be sought. Discussion also focused on guaranteeing that the lake would be accessible to the public.

The Appropriations Committee has included $80 million from the Cash Reserve Fund and $120 million from the General Fund in funding for the LB 1023 projects in their final budget recommendations to the Legislature. Unlike the Governor, the committee did not suggest funding any portion of it with the federal American Rescue Plan Act (ARPA) dollars, as they felt these projects did not fit the criteria put forth by the federal government on the use of these funds. The funding includes $1 million for an independent hydrology study to make sure that Lincoln and Omaha water resources would not be adversely affected.

The Legislature also gave first-round approval on a 36-3 vote to LB 1015, which attempts to secure Nebraska’s water supply from the South Platte River under the 1923 South Platte Compact signed with the State of Colorado. This compact entitled Nebraska to 120 cubic feet per second of water from April 1st through October 15th (irrigation season) and 500 cfs of water from October 16th through March 31st (non-irrigation season). Although we are currently receiving the full amount, senators were told that we can only legally claim the non-irrigation season water entitlement by building the Perkins County Canal, a canal and reservoir system, along the South Platte River.

With population growth in Colorado and talk of water projects, Governor Ricketts has pushed for this project and recommended to fund it with an appropriation of $400 million from the Cash Reserve Fund and $100 million from ARPA funds. Senators have questioned the total projected costs, including maintenance costs, the amount of water Nebraska has the right to, and the urgency for this project. The Appropriations Committee voted to include only $53.5 million for the canal project in its budget package. This would fund a feasibility study, design work, permitting, and potentially buying land.

Second amendment rights were the subject of more than eight hours of debate this past week. LB 773, introduced and prioritized by Senator Tom Brewer, was stuck in the Judiciary Committee. A pull motion to place the bill on General File was successful on a 30-12 vote. A couple days later the bill was filibustered on General File. A cloture motion to end debate and allow a vote on the advancement of the bill was successful on a 36-9 vote, after which LB 773 received first-round approval.

Currently, to get a concealed carry permit, applicants must submit to a background check, pay a $100 fee, and complete an approved handgun training and safety course. Under LB 773, referred to as the constitutional carry legislation, persons wanting to carry a concealed weapon would no long need to obtain a permit.

As the Legislature begins the last 20 days of this 60-day legislative session, I encourage you to inform me of your thoughts and opinions on the legislation before us. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is tgragert@leg.ne.gov and my telephone number is (402) 471-2801.

The public hearing process is now complete. A hearing was held on every bill that was introduced before the committee with jurisdiction over the subject matter. The Legislature begins meeting in full-day sessions on March 8. The following week, we will begin meeting into the evenings, in order to complete our work by April 20.

On Monday of this past week, senators focused on consent calendar bills. Consent Calendar is a process to allow noncontroversial bills without priority status to be debated by the Legislature. If three senators object to any of the bills listed on Consent Calendar, the bill is removed. Furthermore, amendments that are not purely technical in nature cannot be added to these bills. I had one bill on Consent Calendar that was given first-round approval, dealing with township libraries. If a county votes to discontinue a township form of government and the township has a library, LB 75 requires the county board to hold a hearing on what should happen to the library, in order to give residents the chance to voice their opinion.

On Tuesday and Wednesday, senators advanced 17 priority bills that weren’t controversial. Two of the bills I introduced were given initial approval. LB 780 makes common sense changes in two programs administered by the Nebraska Department of Labor – child labor and Nebraska’s short-time compensation program. LB 864 expands Nebraska’s college savings plan, allowing 529 plans to be used for loan payments, reflecting changes made on the federal level.

The Nebraska Economic Forecasting Advisory Board met this past week and voted to increase projections for the current 2021/22 year and the 2022/23 fiscal year. The Board decided to increase their forecast made in October of last year by $370 million for this year and by $405 million for next year. The increased revenue for the current fiscal year will be transferred to the Cash Reserve Fund, bringing its projected balance to $1.7 billion.

Much of the projected increase in revenue can be attributed to the large magnitude of federal dollars that have been distributed to Nebraska – to individuals, businesses, political subdivisions and the state. Nebraska will receive approximately $24 billion! This amount is equivalent to 22% of total state personal income.

The increased revenue projections led the Governor to strongly push for two of his proposals to be funded – $230 million for a new State Penitentiary and $500 million for the Perkins County Canal Project. This is in addition to proposals pending at the second stage of debate to reduce the top rate of the individual and corporate income tax, accelerate the elimination of the state income tax on Social Security benefits, and continue to fund substantial local property tax relief.

The Appropriations Committee is finishing work on the budget and will forward their final recommendations to the Legislature next week. There will be separate legislation with their recommendations for the federal American Rescue Plan Act (ARPA) funding. Since this money is one-time funding, we must be careful to fund projects that won’t have ongoing expenses.

Recently I attended a briefing by the Secretary of State in response to claims that have been made about Nebraska’s elections. He dispelled many of the myths that have been circulating with solid, factual information and charts. Several ballot counting machines were brought in to the briefing and we were able to watch how they actually worked and learned of the safeguards taken to ensure a valid election.

As the Legislature begins full-day debate, I encourage you to contact me with your thoughts and opinions on the legislation before us. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is tgragert@leg.ne.gov and my telephone number is (402) 471-2801.

The Legislature has passed the midway mark in this 60-day legislative session. The priority bill designation process is also complete. From this point on, generally only bills with priority status will be debated by the Legislature.

Every senator gets to select one bill as their priority bill, every committee can pick two, and the speaker is authorized to designate 25 bills as speaker priority bills. I selected LB 925 as my priority bill and it received first-round approval this past week on a 34-7 vote. LB 925 creates the Resilient Soils and Water Quality Act. To carry out the provisions of the Act, a Producer Learning Community would be formed. The PLC would focus on peer-to-peer, hands-on learning, through regional demonstration farms. Healthy soil directly relates to water quality. In an effort to prevent more communities from needing to purchase expensive water treatment systems to address the high nitrate levels, this proactive measure attempts to address the root of the problem by encouraging the use of comprehensive healthy soil practices.

The following is a few of the bills that were designated as senator priority bills:

LB 1023 would adopt the Lake Development Act and the Water Recreation Enhancement Act. This legislation is the result of the work by the STAR WARS Committee and includes projects at Niobrara State Park and the Lewis & Clark Lake State Recreation Area.

LB 933 proposes to adopt the Nebraska Human Life Protection Act. If Roe v. Wade is overturned, this bill would prohibit the performance of an abortion in Nebraska. LB 1086 would adopt the Chemical Abortion Safety Protocol Act and prohibit the sending of abortion-inducing drugs through the mail. The public hearing on both of these priority bills was held this past week before the Judiciary Committee, along with legislation to prohibit an abortion if a fetal heartbeat is detectable on an ultrasound (LB 781).

LB 1015, the Perkins County Canal Project Act, was introduced by the Speaker of the Legislature, at the request of the Governor. The governor included $500 million in his budget recommendations for this canal project on the South Platte River in an effort to secure Nebraska’s water supply from being diverted for projects initiated in Colorado. The canal was authorized in the South Platte River Compact, signed by Nebraska and Colorado in 1923 and ratified by Congress in 1926.

LR 264 is a proposed constitutional amendment to repeal the state income tax, the state sales tax, the property tax, and the inheritance tax. These taxes would be replaced with a consumption tax on services and new goods purchased for personal consumption. Business expenses would not be taxed. A pre-bate payment would be sent to citizens for basic necessities such as food.

LB 773, referred to as the constitutional carry legislation, would authorize concealed carry without a permit in Nebraska. Gun owners would no longer need to obtain a state permit, pay a fee, conduct a background check, or take a training course.

One of the bills that I introduced was selected as a committee priority bill by the Business and Labor Committee. LB 780 makes common sense changes in provisions of two programs administered by the Nebraska Department of Labor – child labor and Nebraska’s short-time compensation program. One of my bills was also selected as a speaker priority. LB 864 would expand the Nebraska Educational Savings Plan to allow education loan payments for a beneficiary or a sibling to qualify as a higher education expense.

Following a filibuster, LB 939 received first-round approval on a 40-1 vote after senators received assurance that its fiscal impact will be re-evaluated at the second stage of debate to determine how it fits in with the revenue outlook. As amended, LB 939 would lower the top rate of both the individual and corporate income tax to 5.84%. There was discussion on whether the thresholds should instead be lowered, which would provide greater tax relief for the middle income.

As the Legislature debates bills that have been designated as priorities, I encourage you to inform me of your opinions. I can be reached at tgragert@leg.ne.gov. My address is District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509 and my office telephone number (402) 471-2801.

The Legislature spent four hours this past week debating LB 906 which focuses on employer vaccine mandates. As amended by Health and Human Services Committee amendments, LB 906 would apply to businesses with one or more employees but would only pertain to the COVID-19 vaccine. LB 906 clarifies that if an employer requires employees to be vaccinated against COVID-19, an exemption to the mandate is allowed for a medical reason, accompanied by a signed statement from their health care practitioner, or for a religious reason, based on the employee’s sincerely held religious beliefs. The employer may require employees granted an exemption to be tested periodically for COVID-19 and wear personal protective equipment, both at the employer’s expense. An amendment was adopted clarifying that federal law supersedes state law. This was necessary after the U.S. Supreme Court upheld a federal vaccine mandate last month for health care providers that participate in the federal Medicare or Medicaid programs.

An amendment was offered to LB 906 that would have stricken the authority of employers to require the unvaccinated to undergo periodic testing and wear PPE. Initially, the sponsor of the bill, Senator Ben Hansen, supported this amendment. However, the committee amendments represented a compromise, allowing several entities to withdraw their opposition to the bill. When the amendment threatened to unravel this compromise, Senator Hansen withdrew his support for the amendment, after which the amendment failed. The cloture motion to end debate and allow for a vote on the advancement of the bill was successful on a 38-3 vote and LB 906 advanced to Final Reading on a 36-2 vote.

Debate began this week on LB 939, which proposes to reduce the top individual income tax rate from 6.84% to 5.84% over a three-year period. The Revenue Committee amendments add the provisions of LB 938, which reduce the top rate of the corporate income tax to 5.84% as well. Last year, legislation was passed to reduce the top corporate income tax rate from 7.81% to 6.84%. Under the amended version of LB 939, the top corporate income tax rate would be reduced further and faster than what was previously enacted. By fiscal year 2025/26, it is estimated that the tax cuts would reduce state revenue by approximately $400 million.

The sponsor of LB 939, Revenue Committee chair Senator Lou Ann Linehan, said that because state revenues have grown far greater than predicted, it is time to return the excess to taxpayers. Furthermore, LB 939 would make Nebraska more competitive with other states, when contending for businesses and residents. Much of the debate centered on whether the Legislature will be able to afford this tax cut in future years and whether it primarily benefits the wealthy.

The Nebraska Chamber of Commerce presented data showing that our current income tax system provides relatively low tax burdens for lower income taxpayers, but that middle-income and above taxpayers have some of the highest income tax rates in the Midwest. They urged Nebraska to modernize our outdated tax system and be more competitive in today’s environment, when trying to attract new residents, talent, jobs, and entrepreneurs. Whereas, the Open Sky Policy Institute distributed information showing that approximately 83% of the corporate income tax cut would flow to out-of-state taxpayers and that 84% of the personal income tax cut would go to the highest earning 20% of Nebraskans.

As the Legislature debates tax policy and other issues, I encourage you to inform me of your thoughts and opinions. I can be reached at tgragert@leg.ne.gov. My mailing address is District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509 and my telephone number is (402) 471-2801.

The public hearing on LB 1023 was held on Thursday, February 10th before the Natural Resources Committee. It reflects the work of the Statewide Tourism and Recreational Water Access and Resource Sustainability Special Committee (STAR WARS) and proposes to adopt the Lake Development Act and the Water Recreation Enhancement Act. I was appointed to serve on the STAR WARS Committee, stemming from the passage of LB 406 last year. In addition to recommendations to construct a 3,600 acre lake in or near Sarpy County and a new marina at Lake McConaughy, the legislation also recommends a new lodge and event center at Niobrara State Park and expanding the Weigand Marina at the Lewis and Clark State Recreation Area.

A number of testifiers representing Knox County, the Village of Niobrara, the Niobrara School District, and the Ponca Tribe drove to Lincoln to express their support for this exciting opportunity to increase tourism and economic development in Northeast Nebraska. Proposed funding for the projects is included in legislation before the Appropriations Committee.

Last week, I mentioned that LB 986 was filibustered. This legislation would have limited an increase in a school district’s property tax asking to 2.5% or the inflation rate, whichever was greater. A cloture motion to end debate and allow a vote on the advancement of LB 986 was unsuccessful, falling five votes short of the necessary 33 votes. A number of senators felt that this would put too severe of a restriction on school districts. An unsuccessful cloture motion means the issue is done for this year.

The Legislature gave first-round approval to legislation addressing vaccine mandates. Under LB 906, any employer that requires its employees to be vaccinated against COVID-19 must allow for an exemption to such requirement if the employee submits a completed vaccine exemption form, developed by the Department of Health and Human Services. An exemption would be allowed for health purposes with a signed written statement from a doctor or if the vaccine conflicts with a sincerely held religious belief. Anyone granted an exemption, could be required to be periodically tested or wear personal protective equipment, at the employer’s expense.

The Legislature began debate on LB 890, which proposes major changes in the school funding formula. The legislation establishes an education stabilization base aid factor in the formula, giving schools approximately $1,100 per student in state funding. The proposal lowers the local effort rate from $1.00 to $0.75 and increases the allocation of state income tax returning to the schools from 2.23% to 20%. One hundred fifty-eight school districts would become equalized under the proposal, up from the current 87 of 244 districts. The intent is to fund the proposal through the dedication of one-half cent of current sales tax revenue and to repurpose the money directed to the refundable income tax credits under the Nebraska Property Tax Incentive Act. After several hours of debate, the sponsor of LB 890 asked that the bill be placed on a Speaker’s hold, only to return to the agenda if an agreement is reached between the primary proponents and opponents.

I introduced legislation pertaining to Nebraska’s College Savings Plan before the Revenue Committee this past week. LB 864 would expand the definition of qualified higher education expenses to allow the funds to be used for education loan payments for the beneficiary or the sibling of a beneficiary, up to $10,000 per person. In December of 2019, President Trump signed the SECURE Act, expanding qualified distributions for 529 plans at the federal tax level to include apprenticeship and student loans. Legislation passed last year to add apprenticeships to the definition of qualified higher education expenses. LB 864 would complete the process by passing enabling legislation on the state level to bring our 529 plan in line with the federal changes. This issue was brought to my attention by a constituent who wanted her son to have more flexibility with his 529 plan, as allowed on the federal level. I worked with the Nebraska State Treasurer, John Murante, who administers our College Savings Plan. He testified in support of the bill, as did the constituent who brought the issue to me. No one testified against the proposal.

If you support or have concerns with any legislation before senators, I encourage you to contact me with your thoughts. I can be reached at tgragert@leg.ne.gov. My mailing address is District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509 and my telephone number is (402) 471-2801.

We have reached the one-third mark of this 60-day legislative session, but still have a great deal of work to do. The various Standing Committees are busy holding public hearings on the 600 bills that were introduced in January. As of February 3rd, public hearings have been conducted on 257 bills during the first three weeks of hearings, but 343 bills have yet to be heard during the next four weeks before the public hearing process concludes and the Legislature begins to meet on the floor in full-day debate.

LB 925, the bill I introduced to create the Resilient Soils and Water Quality Act, was advanced from the Natural Resources Committee this past week. I have designated it as my priority bill. The purposes of the Act are to accelerate the use of best management practices for healthy soil; protect and improve soil and water quality; protect the public’s health and enhance agricultural production and profitability; and to increase awareness, education, and promotion of best management practices for healthy soils through peer-to-peer relationships, as well as demonstration and research farms.

Under LB 925, the Department of Natural Resources would hire a facilitator to assist in the formation of a producer learning community (PLC). The PLC is an agricultural producer-led nonprofit voluntary organization dedicated to fostering the learning and sharing of knowledge, while carrying out the purposes of the Act. The intent is that the PLC would become self-sufficient after five years.

Thirty-seven other states have formed Producer Learning Communities, which were started because their members wanted to learn and enhance their working knowledge to promote best management practices for healthy soils to others. It has been found that producers can effectively learn from their peers. When I ran for the Legislature, water quality was one of my top priorities. The quality of our soil and water are vital, not just for increased agricultural production, but for economic viability, long-term food security, and our quality of life. High nitrate levels in wells across the state are of major concern to me. Rather than focusing on being reactive and treating water with high nitrate levels, I am supportive of being proactive and pushing for a comprehensive plan of best management practices for healthy soils.

Public hearings were held this past week on two bills that I introduced. LB 779 was heard before the Government, Military, and Veterans Affairs Committee. It would remove the 10-year limitation on access to state tuition assistance for members of the Nebraska National Guard. This bill would harmonize the National Guard with the Reserve component, which has no lifetime limit on tuition credit. This could serve as a recruiting and retention tool and would not require additional state funding. The National Guard testified in support and no one opposed the bill.

LB 1082 was heard before the Natural Resources Committee. It would require applications for annual hunting or fishing permits to include a question asking applicants if they want to add their name to the Donor Registry and donate their organs upon death. Although potential donors can also register when obtaining a driver’s license, this would allow for an annual registration opportunity, instead of waiting on our 5-year drivers’ license cycle. Other states with a similar law have seen immediate success in growing their donor registry. On any given day, there are approximately 300 Nebraskans and 100,000 Americans waiting for an organ transplant. A father of a son who died while waiting for a heart transplant gave compelling testimony, noting his promise to his son that he would carry out his mission to obtain more donors.

The Legislature spent several hours discussing LB 986, as the bill was filibustered this past week. LB 986 would limit an increase in a school district’s property tax asking to 2.5% or the three-year inflation average, whichever is greater. This limit could be exceeded with a 75% vote of the school board or a 60% majority of voters. The amount by which it could be exceeded ranges from 7% for school districts with an average daily membership of 471 or less to 4% for districts with more than 10,000 students.

As we continue the public hearing process, I encourage your input on the legislation before us. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is tgragert@leg.ne.gov and my telephone number is (402) 471-2801.

This past week, the Legislature gave first-round approval to two bills offering tax relief for Nebraskans. Further debate on the two proposals will wait until we are further along in the session and have a better idea of projected revenues and expenses.

LB 825 accelerates the phase-out of the taxation of social security benefits. Under the proposal, all social security benefits will no longer be subject to the income tax beginning in 2025.

LB 723 guarantees a higher level of property tax relief for taxpayers. When senators passed the Property Tax Incentive Act two years ago, it called for a significant hike in funding for the income tax credit, from $125 million the first year to $375 million the fourth year. The formula used to calculate the annual increase in funding considered whether the cash reserve was adequately funded and included excess revenue growth above 3.5%. Due to the postponement of income tax filings because of the pandemic and the influx of federal pandemic relief dollars, it pushed the formula to an unpredicted $548 million this year, which represents about 25% of property taxes paid to school districts (the largest recipient of property taxes). LB 723 will guarantee that the $548 million in funding is not reduced to $375 million, as specified as the funding level for the fourth year in the original legislation. This amount will be allowed to grow annually by the increase in the total assessed value of real property from year to year. An amendment was added to ensure the funding is sustainable in future years.

LR 14 authorizes the Legislature to apply to Congress, under the provisions of Article V of the U.S. Constitution, to call a convention of states limited to proposing amendments to the Constitution that impose fiscal restraints on the federal government, limit the power and jurisdiction of the federal government, and to prescribe term limits for members of Congress. LR 14 was passed by the Legislature on Friday, January 28th with a 32-11 vote, after successfully overcoming a filibuster. LR 14 won’t take effect until the Legislatures in 33 other states make application on the same subject.

A revamped funding formula for school districts was proposed in LB 890 and LB 891. The proposed plan would increase state support for almost every school, which would in turn provide property tax relief. A public hearing was held on LB 890 this past week before the Education Committee and on LB 891 before the Revenue Committee. The Education Committee selected LB 890 as one of their two committee priority bills. The proposal would implement a district specific maximum levy calculated for each school district, not to exceed $0.95. The new formula is projected to result in $715 million in property tax relief. It would repurpose the Property Tax Incentive Act and dedicate one-half of one cent of the sales tax to the state aid formula, which would be matched by the state. A new component of the formula is the Education Stabilization Base Aid, guaranteeing a certain amount of state funding (approximately $1,100) for every student. The allocated income tax returned to school districts would increase from 2.23% to 20%, which was the original intent when the current state aid formula was enacted. More school districts would qualify for equalization aid under LB 890 and LB 891. Currently only 87 of the state’s 244 school districts qualify, but under this plan 148 districts would receive equalization aid. The increased state funding would result in the state paying approximately 58% of the cost of schools, with local property taxes funding 42%. Although some question whether significant property tax relief is guaranteed under this proposal, I believe it warrants discussion.

The Crime and Justice Institute worked with the Nebraska Criminal Justice Reinvestment Working Group (made up of criminal justice leaders from across the state, the chair of the Judiciary Committee, the Governor, and the Chief Justice) to develop a report that evaluated Nebraska’s criminal justice system. Senator Steve Lathrop, the chair of the Judiciary Committee, introduced LB 920 as a result. The reforms proposed attempt to reduce prison overcrowding and recidivism. Nebraska has the most overcrowded prison system in the nation. Discussion has centered on whether we can build our way out of this, if we need to enact reforms, or both. Data has shown that while the prison population increased over the last decade, admissions decreased, reflecting the consequences of mandatory minimum sentences and increasing sentence lengths. The Governor has proposed building a new 1,500 bed prison to replace the Nebraska State Penitentiary. However, if reform isn’t enacted, projections show that even with the new prison, our system would be overcrowded again by 2030.

Again, I encourage you to inform me of your thoughts on the bills before the Legislature. I can be reached at tgragert@leg.ne.gov. My mailing address is District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509 and my telephone number is (402) 471-2801.

Just over 600 bills and constitutional amendments were introduced during the 10-day bill introductory period for this legislative session. Currently, the various committees are in the process of holding public hearings on every bill introduced.

Senators gave second-round approval to LR 14 this past week. This resolution would serve as Nebraska’s application for a convention of the states authorized under Article V of the U.S. Constitution, to limit the power of the federal government, impose fiscal restraints, and enact term limits for members of Congress. Prior to receiving second-round approval, an amendment was adopted that would rescind the application in 5 years. LR 14 is now ready for Final Reading.

Two bills that were heard before the Revenue Committee this past week, were advanced and scheduled for debate by the Legislature. In 2020, the Legislature passed LB 1107 which created a refundable income tax credit for a portion of property taxes paid to school districts. The funding for this program began at $125 million, with the intent to increase it to $375 million by the 4th year of the program. However, the increased revenue the state has recently experienced has impacted the formula and created higher funding levels than predicted. LB 723 creates a floor for the amount of the refundable income tax credit for property taxes paid to school districts, so that it’s not reduced below the current $548 million in funding for this program.

LB 825, introduced by Senator Brett Lindstrom, would exempt all Social Security income within a four-year period. Last year, Senator Lindstrom introduced LB 64 which phased out 50% of the tax on Social Security income by 2025 and included intent language to increase the percentage of social security benefits that are excluded from the income tax to 100% by year 2030. LB 825 speeds up this process, exempting 40% this year and increasing the exemption by 20% annually until all social security benefits are exempt from taxation in year 2025.

The public hearing was held this past week on LB 773 before the Judiciary Committee. LB 773, referred to as the constitutional carry legislation, allows anyone who isn’t otherwise prohibited by state law to carry a concealed weapon without a permit in Nebraska. Persons wanting to carry a concealed weapon would no longer need to have a background check, complete training, or pay the fee for a permit. Senator Tom Brewer, the sponsor of LB 773, has already designated it as his priority bill. Representatives of law enforcement testified against the bill at the public hearing, stating that it could jeopardize public safety and hinder their ability to seize illegal guns. Senator Brewer vowed to work with them to address their concerns.

LB 809 was heard before the Natural Resources Committee, on which I serve. Introduced by Senator Mike Moser, at the request of the Nebraska Department of Environment and Energy, the legislation would amend the Drinking Water State Revolving Fund Act and the Wastewater Treatment Facilities Construction Assistance Act to better align the funds with the new provisions of the Infrastructure Investment and Jobs Act. The legislation increases the allowable amount of grant and loan forgiveness assistance to up to 75% of eligible project costs for entities serving 10,000 persons or less. This bill will help our smaller communities afford necessary modifications to their drinking water systems.

As the public hearing process continues, I urge you to contact me with your thoughts and opinions on bills that have been introduced. I can be reached at District #40, P.O. Box 94604, State Capitol, Lincoln, NE 68509. My email address is tgragert@leg.ne.gov and my telephone number at the State Capitol is (402) 471-2801.

Sen. Tim Gragert

District 40
Room 11th Floor
P.O. Box 94604
Lincoln, NE 68509
(402) 471-2801
Email: tgragert@leg.ne.gov
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