As of Monday, March 18, we have 15 days remaining in the 2024 60-day legislative session. This past week primarily dealt with the budget and changes to the state Cash Reserve fund. Although these bills were filibustered, the filibusters were intended to spur good debate on the changes offered by the Appropriations Committee.

LB1412 is the budget bill that outlines the changes recommended by the Appropriations Committee after hearing testimony from all the state agencies and bills offered by Senators that contain spending measures. After hearing all the testimony, the committee is tasked with making changes to the budget while staying within the dollars available to the Legislature to spend as projected by the Nebraska Economic Forecasting Advisory Board. LB1412 results in $570,014,033 million remaining in the General Fund (state’s checking account) at the end of the fiscal year 2024-25. However, the budget also projects that the General Fund ending balance will drop to $63,711,376 by the end of the 2026-27 fiscal year. The decline is primarily due to the final phase, the end of the income tax reductions passed in 2022, which takes the top state income tax rate to 3.99%.

I am happy to report that my LB850 was included in LB1412. LB850 includes a program that will provide North Platte with $1 million in funding to help improve dilapidated lots that can be used for workforce housing.

LB1413 dealt with changes to the Cash Reserve Fund and the transfer of funds from agency cash funds. One change proposed by the Appropriations Committee was a recommendation to transfer $5 million from the Nebraska Tourism Fund to the Department of Economic Development. I introduced a floor amendment to stop the transfer, which was ultimately successful. These funds are very important to attract more in-state and out-of-state travelers to visit attractions throughout Nebraska. Many of these attractions are located in District 42: NEBRASKAland Days, the Highway 2 Scenic Byway, and the Nebraska Passport Program, to name a few.

It should be kept in mind that state revenue is expected to grow at a rate of 3.6% moving forward, which will cause the General Fund balance to grow as long as state spending grows at a slower pace. I also want to point out that the Cash Reserve Fund (state’s savings account) or rainy-day fund currently has a fund balance of $914,567,475. That balance is projected to be $804,053,413 at the end of the 2026-27 fiscal year. The balance declines are due to one-time transfers approved by the Legislature.

Remember, any excesses in the General Fund at the end of each fiscal year are automatically transferred to the Cash Reserve Fund. Additionally, the Cash Reserve Fund is once again at or near its statutory maximum. In the end, the State is in excellent fiscal shape.

This coming week, we will likely focus on the Revenue Committee bills, which deal with tax changes. To the extent the bills offered by the Revenue Committee involve “revenue reductions,” they will also impact the funds available to be spent before the next budget cycle. Spending will need to be limited to the $63,711,376 projected to remain in the General Fund. Any spending beyond that would impact the Cash Reserve Fund and likely attract a veto from the Governor. Although the Cash Reserve has sufficient funds to support some drawdowns, the state needs to prepare for reduced revenues due to changes in the national economy over the next few years.

I will be working this week to make improvements to LB126, the bill the Revenue Committee chose to use as the vehicle to carry the Homestead Exemption changes. This bill was introduced in 2023 by Senator Day. I introduced LB853 this year to make more comprehensive Homestead Exemption changes that help both Veterans and those over age 65 who are on lower fixed incomes. I have been working with Lincoln County Assessor Julie Stenger and Todd Von Kampen with the North Platte Telegraph to develop an amendment to LB126. This will likely be a very heavy lift, but these changes are important.

I also want to make certain that everyone knows that the LB894, introduced by Senator Ibach, requires a candidate running for County Sheriff to be a certified law enforcement officer when they file to run for office. Unfortunately, Senator Wayne offered an amendment to allow DACA residents to also qualify to be a County Sheriff. Although this amendment got added to the bill, it did not take long for several constituents, including David Huebner, to reach out to let me know that DACA residents (Deferred Action for Childhood Arrivals) are able to be in this country because of an executive order issued by President Obama to allow deferred action from deportation and become eligible for employment in the U.S. if they have no felonies or serious misdemeanors on their records. It, however, does not provide for a path to citizenship. They also are not allowed to own or carry a firearm. As a result, this bill will not be moving forward unless or until this amendment is removed from the base bill during Select File. Thank you, David, for your input and to everyone who took the time to reach out to my office. This is how the process should work.

I look forward to continuing to hear from you regarding issues that are important to you. It is a privilege to serve as your State Senator, and I will continue to give my full effort to make a positive difference for the District and the State. You can reach me at mjacobson@leg.ne.gov or 402-471-2729.