NEBRASKA LEGISLATURE
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Sen. Steve Erdman

Sen. Steve Erdman

District 47

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 serdman@leg.ne.gov

Straight Talk From Steve…

April 20th, 2018

 

LB496 allows new construction of workforce housing to be eligible for Tax Increment Financing (TIF). On the final day of the Legislative session I tried to kill LB496 because I knew how it would raise property taxes. The Nebraska State Legislature passed LB496 over and against my objections to the bill. There were several reasons to oppose this bill and I would like to share some of those reasons today, but the most important reason of all is that LB496 will increase your property taxes.

LB496 offers no clear definition of what constitutes workforce housing. For instance, the bill describes workforce housing as “housing that meets the needs of today’s working families,” and “housing that is attractive to new residents considering relocation to a rural community.”

The original purpose of TIF financing was to redevelop substandard and blighted areas within urban neighborhoods. For instance, Nebraska State Statute 18-2101 states that “land cannot be added to an existing community redevelopment area…unless the additional land is declared blighted or substandard…” So, we should ask if newly constructed workforce housing counts as the redevelopment of blighted or substandard properties.

As Americans we value free-market capitalism. But, TIF financing disrupts our free-market principles. To the contrary, I believe that whenever there is demand for new homes, private investors will build them. Government does not need to be the answer for every problem as some like to believe.

Characteristic of all other government funded programs of this kind, TIF will be nearly impossible to get rid of. Once contractors get a taste of TIF financing and learn that they can always use TIF monies to fund their construction projects, TIF financing will quickly become the norm.

Whenever workforce housing gets financed through TIF, property taxes get diverted away from local units of government. While property taxes from the base of a TIF funded property will continue to go to local units of government, property taxes gleaned from the new construction will not. This results in a net loss of revenue for our local units of government, such as schools. For instance, instead of being used to finance local units of government, property taxes collected from new construction on TIF financed properties will go to paying back bond holders. In Douglas County, for example, local units of government missed out this year on $37 million in property taxes collected from new construction on TIF financed properties.

Whenever workforce housing gets financed through TIF, other property owners have to make up the difference in lost property tax revenues. For instance, if ten new houses get built with TIF financing and ten new families with children move into those new homes, then the other property owners living in the same school district will have to pay for the extra costs associated with educating those children in the public schools. Consequently, TIF financed workforce housing raises the property taxes of all those who purchased their homes in the standard way.

LB496 was a bad bill for Nebraska. TIF financing for the construction of workforce housing is not necessary. Contractors who want to build new houses in our state can fund them in the traditional way without disrupting our free market economy. When Legislators voted for LB496, they were voting for a property tax increase. Unfortunately, government often picks winners and losers and uses your tax dollars to do it. To the contrary, I stand for less taxes and less government!

Straight Talk From Steve…

April 13th, 2018

 

The second session of the 105th Legislature is now over. Overall, very little meaningful legislation got passed this year. The Legislature could not agree to reduce your property taxes, to reform the way agricultural land gets valuated for tax purposes, to call for an Article V Convention of the States, or to secure free speech for our students at the University of Nebraska. In my estimation, this year’s legislative session was essentially a wash.

Instead of passing fiscally responsible legislation for the State, the Nebraska State Legislature passed LB873, a bill that will create more land banks, which will only increase your property taxes. A land bank is a public authority created to hold, manage and develop properties. The Legislature also passed LB496, a bill to increase Tax Increment Financing (TIF) for the building of workforce housing. LB496 will also increase your property taxes.

In a last ditch effort to get property tax relief, 13 State Senators signed a letter and sent it to John Gale, our Secretary of State, calling for a special session of the Legislature in order to address the subject of property tax relief. Only ten Senators were needed to sign the letter, but 33 Senators will have to express their favor for a special session in order for it to happen. The deadline for the Senators to respond is April 23. Of no surprise to me, Governor Ricketts is not in favor of calling for a special session of this kind.

On a much more positive note, the petition drive to put a measure for property tax relief that is similar to my bill, LB829, on the November ballot is progressing very well. The Lincoln Strategy Group, the company Trent Fellers hired to collect the signatures for the ballot initiative, has reported that the task of collecting signatures for the petition drive has been easier than when they collected signatures to re-instate the death penalty. Therefore, I am confident that we will get enough signatures to meet the July 5 deadline and to put this measure on the November ballot.

The fact that we’ve had to resort to a petition drive in order to get meaningful and substantial property tax relief for all Nebraskans needs to be underscored. Meaningful and substantial property tax relief is the number one issue that Nebraskans care about and it is an issue which has united both urban and rural citizens alike in our state. Unfortunately, the majority of the Senators who comprise our State Legislature and our Governor do not understand this desperate need for meaningful and substantial property tax relief nor do they agree that this should have been the number one priority for the Legislature this year.

I have taken my service to the constituents of Legislative District 47 and to all Nebraskans very seriously. I am very disappointed that the Legislature has failed to deliver on property tax relief. This issue continues to weigh heavily upon my heart, especially when I talk with constituents and cannot report that we have fixed the problem. Nothing is more important to me than solving the problem of property tax relief. However, there remains hope for the future.

The citizens of the State of Nebraska comprise our State’s second legislative House. When the Legislature fails to deliver the kind of legislation Nebraskans need most, it becomes incumbent upon the people of the State to act and to assert their own will. Therefore, I want to encourage all of my readers to sign the petition and to vote for property tax relief in the November election.

Thank you for allowing me to serve as your State Senator.

Straight Talk From Steve…

April 6th, 2018

Paying for prescription drugs has become a big problem for many Americans as well as for legislators. Legislation designed to control the costs of prescription drugs often stalls in the Legislature. For instance, after Sen. Sara Howard introduced LB862, the Prescription Drug Cost Transparency Act, the bill stalled in committee. Therefore, this week I want to expose what the pharmaceutical companies do to raise the costs of your prescription drugs and what you can do about it.

It may be cheaper for you to pay for your prescription drugs out of pocket than to pay your health insurance company’s co-pay. A recent study conducted by the University of Southern California’s Schaeffer Center for Health Policy & Economics found that customers overpaid for their prescription drugs 23 percent of the time.

The practice of charging copays which are higher than the actual cost of prescription drugs is called a “clawback”. Middlemen who process prescription drug claims for health insurance companies oftentimes make it a practice to claw back extra money from their insured clients when they check out at the pharmacy. For instance, if your co-pay is $10, but the actual cost of your prescription drug is only $7, then you are essentially giving an extra $3 to your health insurance provider.

It does not seem to matter whether or not states have passed anti-clawback laws. Health insurance companies have found ways to get around these kinds of state laws. For instance, some insurance plans prohibit pharmacists from volunteering information about getting cheaper prescription drugs. Therefore, the burden falls upon the consumer to ask the pharmacist if there is a cheaper way to pay for the drug. Six states have passed anti-gag laws to prevent insurance companies from gagging their pharmacists in this way, but Nebraska is not one of these six states.

According to Sydney Lupkin of Kaiser Health News, the top 20 prescription drugs with clawbacks are these: Hydrocodone acetaminophen, levothyroxine sodium, azithromycin, Lisinopril, fluticasone propionate, simvastin, atorvastatin calcium, omeprazole, amoxicillin, amlopidine besylate, sertraline hydrochloride, amox trihydrate/potassium clavulanate, zolpidem tartrate, Ventolin HFA (albuterol sulfate), Crestor (rosuvastatin calcium), metformin hydrochloride, hydrochlorothiazide, metoprolol cuccinate, citalopram hydrobromide, and prednisone.

If you are using any of these prescription drugs, it may be cheaper for you to pay for your prescription drugs out of pocket than to pay your insurance company’s co-pay. The only way to know if you are over-paying is to ask your pharmacist.

On another note, Nebraska State Treasurer, Don Stenberg, has released his 2018 edition of the Unclaimed Property Report. The Nebraska State Treasurer’s office holds more than $170 million in unclaimed money for more than 350,000 current and former Nebraskans. Last year, the Treasurer’s office paid out 16,748 claims totaling $15.3 million. For claims over $500 you will need to mail in a paper claim form. To see if the Treasurer is holding your unclaimed money or to file a claim please go to the State Treasurer’s website at www.treasurer.nebraska.gov or call my office at (402) 471-2616 and my staff will check the list for you.

Finally, although Speaker Scheer’s deadline passed last Friday for the Governor’s property tax relief bill to see another round of debate, he agreed to put LB947 back on the agenda. Without the needed 33 votes, though, LB947 will be dead. So, the petition drive for LB829 represents our best hope for property tax relief this year. Therefore, I want to encourage all of my readers to sign the petition.

Straight Talk From Steve…

March 29th, 2018

I went to the Nebraska State Legislature for one primary purpose: To ease the burden of property taxes for all Nebraskans. Whether a person lives in an urban setting, a suburban neighborhood, a rural small town, or runs a business, farm or a ranch, property taxes are simply too high.

One thing has become abundantly clear to me during my short time working in the Legislature: Governor Ricketts does not want property tax relief. The Governor’s so-called property tax relief bill, LB947, does not bring any meaningful property tax relief to Nebraskans. LB947 is fake news or fake legislation, because it is nothing more than a shell game designed to fool the general public into believing they are receiving meaningful and substantial property tax relief when really they are not.

LB947 begins by offering agricultural property owners a two percent credit or refund the first year the plan is enacted. Considering that property taxes have been increasing by an average of 5.63 percent per year, we should ask: Is this really property tax relief? In 2027 these property tax credits or refunds would max out at 20 percent. Can you afford to wait another ten years to get 20 percent property tax relief?

The bill is much worse when it comes to residential property owners. LB947 would start residential property owners with a one percent credit or refund with a cap set at $25. So, the owner of a home valued at $150,000 would get a credit or refund of $25. Is that property tax relief? These credits would increase over time to 20 percent of property taxes paid until they reach a cap set at $500 in 2030. Is that substantial?

Business owners get shafted the most. LB947 offers no property tax relief whatsoever for businesses. Instead, the bill cuts the corporate income tax rate from 7.81 percent to 6.84 percent. Apparently, Governor Ricketts doesn’t think business owners need property tax relief. LB947 actually raises commercial property taxes in order to give relief to farmers and residential home owners.

By way of comparison, my bill, LB829, would start all property owners off the bat with a 30 percent credit or refund on their property taxes. This is no small matter because LB947 is heavily back-loaded. When you adjust for an average annual property tax increase of 5.63 percent, and factor in 8.5 percent for the value of money over time, the astute observer begins to realize the significant savings contained in my bill compared to the Governor’s bill.

For instance, a parcel of land valued at $283,000 with a mill levy set at 2.21 percent would currently make a property tax bill of $6,254. If no legislative bills ever passed for property tax relief, this landowner would end up paying $85,579 over the course of the next ten years. Under LB947 this same landowner would pay $77,277 over the same ten year period for a total savings of $8,302. However, under LB829 this same landowner would pay only $56,713 over the course of ten years for a total savings of $28,866.

Underlying LB947 lies an even more disturbing problem. Instead of making the necessary budget cuts in order to balance the State budget, LB944 takes another $40 million out of the State’s cash reserves to pay for these credits and refunds. So, the Governor never paid for his property tax relief bill.

I came to Lincoln to deliver on property tax relief. Together with Mr. Trent Fellers, we started the petition drive to put LB829 on the November ballot precisely because we did not believe that the Legislature had enough fortitude to pass meaningful and substantial property tax relief. As a property taxpayer and as a voter you now have the opportunity to let your voice be heard by signing the petition and by voting YES for real property tax relief in November.

Finally, I have posted a property tax savings calculator on my legislative website. By following the instructions on my website, you can see for yourself what your property taxes will look like ten years from now under LB947 and also under LB829.

Straight Talk From Steve…

March 23rd, 2018

One of the most controversial bills of the year in the Nebraska Legislature has been the Governor’s budget bill, LB944. Last Friday the cloture vote on LB944 failed by just two votes. With little time left in the current legislative session, the prospect of the Governor having to call for a special session of the Legislature after we adjourn in April in order to approve a budget is getting closer.

LB944 has become controversial for two reasons. First, the Governor had originally cut funding for the University of Nebraska by 4 percent, but the Appropriations Committee reduced these cuts to 1 percent when they amended the bill. When the bill came up for debate on Select File, I introduced an amendment to restore these cuts back to the Governor’s original proposal of 4 percent. Although my amendment failed to pass, we finally got to have a serious discussion about the various ways that the University of Nebraska misuses taxpayer dollars.

Second, LB944 is controversial because it contains language about Title X funding which excludes those clinics “where abortion is a method of family planning.” According to federal law, Title X funds cannot be used to fund abortions.

Planned Parenthood of the Heartland has a history of violating Title X funding. For instance, Nebraska’s State Auditor, Charlie Janssen, had reported back in 2016 that Planned Parenthood had illegally spent at least $3,500 in public monies to pay for physicians’ fees, staff salaries, and pathology work specifically related to placenta and fetal tissue. Because Planned Parenthood of the Heartland has a track record of abusing Title X funding, the decision was made this year to exclude them from Title X funding altogether in the State budget.

Last year President Trump signed a congressional resolution allowing states to withhold Title X funds from abortion providers. Under the Obama administration states had been prohibited by a rule from withholding these funds from abortion clinics. In response to Trump’s signing of the congressional resolution, Russell Moore, president of the Southern Baptist Ethics and Religious Liberty Commission had said, “It is a travesty that any taxpayer money goes to support the exploitive work of Planned Parenthood.” I agree. Nebraska taxpayers should never be forced to support an industry that the majority of us hold to be immoral.

Straight Talk From Steve…

March 16th, 2018

The Nebraska Legislature has finally begun debating the State’s biennial budget. The good news is that the language contained in LB944 for Title X spending will exclude those clinics which perform abortions. Our budget ought to reflect our values. Because Nebraska is a pro-life state, it makes sense that our taxpayers should not have to fund those agencies which perform a practice that most of us consider to be immoral.

Unfortunately, when LB944 came up for debate last week on General File we never got the opportunity to talk about funding for the University of Nebraska. However, I have filed an amendment to the bill so that this will be the first topic up for debate when LB944 comes up for debate on Select File. It is time for the Legislature to have a serious discussion about how we fund the University of Nebraska system.

Although the Governor had recommended cutting state funding for the University of Nebraska by 4 percent, LB944 only cuts state funding to the University of Nebraska system by 1 percent. My amendment would restore these cuts to the Governor’s recommended amount of 4 percent.

As I said in my article last week, the University of Nebraska’s operational revenues actually increased by six percent last year. So, a 1 percent reduction in state spending to the University might seem like a big deal to University of Nebraska administrators, but not to the average taxpayer, especially when compared to some of the cuts made to other state agencies. For instance, Program 519, a program to provide homes for Nebraska’s veterans is slated to be cut by almost 17 percent in the State’s General Fund next year.

The fact of the matter is that the University of Nebraska has been spending money recklessly since 2011. For instance, according to the University of Nebraska’s own Operating Budget, the University’s total budget has grown by 23 percent since 2011 while tuition and fees have grown by 45 percent. Over that same period, spending on administrator’s salaries grew by nearly 40 percent, while student enrollment grew by less than 7 percent.

University spending over the course of the last three years has been the worst. In 2014 the University of Nebraska spent $290,256,191 on faculty salaries, but in 2017 they spent $321,693,466. That’s an increase of 10.8 percent in only three years. In 2014 the University of Nebraska spent $36,959,542 on administrators’ salaries, but in 2017 they spent $45,134,137 on administrators’ salaries. That’s an increase of 22.1 percent in just three years!

According to the Center on Budget and Policy Priorities, from 2008-2017 Nebraska ranked 4th highest in the nation in state funding for higher education. Nebraska was one of only 5 states which has increased state funding for higher education on a per-student, inflation adjusted basis. While the average state spent 16 percent less per student in 2017 than in 2008, Nebraska spent more per student. Over the past decade more than 30 states have reduced state funding per student on an inflation adjusted basis for higher education by double digits. So, we are clearly moving in the wrong direction.

The University of Nebraska spends money wastefully. When I see the University of Nebraska spending $165,000 per year on a lobbyist, and when I see them spending $370,209 on 7.5 faculty members in the Diversity Chancellor’s pool and another $2,970,392 on the Diversity Central Administration Pool, I cannot help but conclude that University spending is running out of control.
Therefore, I believe the time has come for the Legislature to finally have a serious debate about how they fund the University of Nebraska system with our tax dollars.

Unclaimed Property Report

March 9th, 2018

The 2018 edition of the Unclaimed Property Report is out. To see if the State of Nebraska is holding your unclaimed property or to file a claim, please call (402) 471-8497. You may also check online by clicking on the following link: Unclaimed Property Report Online.  As always, please feel free to call my office at (402) 471-2616 with your questions.  My staff can also check to see if you have any unclaimed property.  Nebraska State Treasurer, Don Stenberg, oversees all of Nebraska’s unclaimed property.   He is pictured below.

Don Stenberg

Straight Talk From Steve…

March 9th, 2018

I continue to lose faith in President, Hank Bounds, Chancellor, Ronnie Green, and the other Chancellors to lead the University of Nebraska system. Besides their failure to lead during the fiasco that unfolded last fall when Kaitlyn Mullen was harassed by a graduate teaching assistant and an English professor, their means for getting more State funding for the university also need to be exposed.

Bounds, Green and the other Chancellors have been threatening to close University programs in order to pressure state legislators into giving them more money. The decision to close the Haskell Ag Lab in Concord, the elimination of the baseball team at the Kearney campus, the cutting of extension programs, and the ending of the Dental Hygiene program in Gering are just four examples of how the university has targeted specific Senators who have dared to question their use of taxpayer’s dollars.

The University of Nebraska has not dealt honestly with the public regarding their funding. For instance, Governor Ricketts had proposed cutting the University’s State funding by $11 million for the 2017 fiscal year and another $23 million for the 2018 fiscal year for a total of $34 million in cuts. But the actual cuts made to the University, as proposed by the Appropriations Committee, amounted to $11 million for the 2017 fiscal year and $6 million for the 2018 fiscal year for a total of $17 million in cuts. That’s half of what Governor Ricketts had originally proposed. But, what Bounds, Green, and the other Chancellors don’t want their university students, legislators, and the general public to know is that their revenues have actually increased.

The University of Nebraska has a lot of money flowing into their system. The Independent Auditor’s Report of the University of Nebraska system reveals on page 13 of the report that the University’s operating revenues actually increased by $74 million for fiscal year 2017. So, while Hank Bounds whined before the Appropriations Committee for one hour and forty minutes about how the University of Nebraska could not afford to suffer a two percent reduction in State funding, their operational revenues actually increased by six percent!

The University of Nebraska has been frightening students by threatening to close some of their much needed academic programs unless they get more funding from the State. Some of these students have come to visit me at the State Capitol. But, after I show them how the University’s operating revenues have increased by $74 million or six percent and how they continue to sit on a pile of cash reserves in excess of $230 million, they begin to realize where the problem really lies.

The University of Nebraska continues to be a very well-funded university system. There simply are no logical reasons for Hank Bounds, Ronnie Green and the other Chancellors to make the program cuts they keep threatening to make. However, I believe it is time for University of Nebraska students, legislators, and the general public to know the truth about how much money is really flowing into the University of Nebraska system.

Straight Talk From Steve…

March 2nd, 2018

I care deeply about the safety of children in our public schools. In no way do I wish to put any of our children into a situation where they might be harmed. I believe our public schools should be safe places for children to learn. As the recent terroristic threat inscribed on a bathroom stall at Creek Valley High School in Chappell so aptly demonstrates, schools in Nebraska’s Panhandle are not immune from the same kind of violence which recently occurred down in Florida.

Finding a sensible way to protect children in our public schools will not likely be found in the hysteria which has resulted in the aftermath of the shooting at Marjory Stoneman Douglas High School.

The facts of the matter are that automatic weapons, such as machine guns, silencers, and sawed off shotguns have been banned in our country ever since the National Firearms Act of 1934. Bump stocks do not turn rifles into automatic weapons, and “assault rifle” is nothing more than a term that activists use who want to ban more guns. Had the FBI and local law enforcement acted upon the warnings previously given to them about Nicolas Cruz, the entire incident in Florida never would have occurred.

Banning more guns does not solve the problem of school violence. Consider, for instance, that on April 9, 2014 16-year-old sophomore student, Alex Hribal, ran through the hallways of his Murrysville, Pennsylvania high school, stabbing 20 students and one security officer in the stomach with two eight-inch kitchen knives. Four students suffered life-threatening injuries that day. One student barely escaped death when the knife that pierced him came dangerously close to his heart. So, banning guns makes as much sense as banning kitchen knives, and ignores the deeper issues related to school violence.

The problem of school violence is really a parental, cultural, moral and spiritual problem. Thirty years ago, students did not shoot up their schools even though they had more access to guns than students do today. Earlier in our nation’s history, parents were more involved in their students’ lives and morality and faith were taught and encouraged in our public schools, and the Judeo-Christian worldview was woven throughout our curriculum. For instance, in his 1904 textbook entitled, “The Elements of English Grammar” William F. Webster included these four sentences in a simple student exercise on identifying nouns: “Cathedrals are impressive,” “God is in His world,” “Silence is a great peacemaker,” and “The finest churches are made of stone.” These kinds of sentences can no longer can be found in our students’ textbooks.

The ethics which dominate in our public schools today are global warming, diversity, and gay rights. Because traditional morality and spirituality are so lacking in today’s curriculum, some educators have now begun to tell their students not to murder their classmates and not to rape women. However, traditional education never had to say such things, because we were taught from the beginning to be kind, to be respectful of others, and to always act like a lady or a gentleman.

In his remarks this week about the passing of Rev. Billy Graham, President Donald Trump said, “Faith promotes love, hope, charity, kindness, mutual respect, and civility. It has always been an important part of America.” He was right. So, what America’s youth need most today are healthy, loving families, spiritual revival, and moral awakening.

Straight Talk From Steve…

February 23rd, 2018

Image may contain: 1 person, sitting and indoor

 

Last week was a very busy week for me at the Capitol. On Monday the petition drive for the property tax relief ballot measure was launched. The petition drive will put onto the November ballot the same measure as my legislative bill, LB 829. The ballot measure would direct the Department of Revenue to give Nebraska property taxpayers up to 30 percent off their property taxes in the form of a credit or refund.

Last fall I received a passionate phone call from a Palmyra farmer. He pressed me to deliver on property tax relief. I told him I was working on a bill. He then proceeded to tell me how his daughter is also a State Senator at the Capitol, but she would not listen to him talk about the need for property tax relief. His daughter is Sen. Kate Bolz of Lincoln. After I told him about the petition drive, he asked me if he could be the first one to sign a petition. So, Mr. Craig Bolz of Palmyra became the first person to sign a petition for property tax relief in Lincoln.

Mr. Trent Fellers of Lincoln, who is the executive director of Reform for Nebraska’s Future, heads the committee which oversees the petition drive. Mr. Fellers has done an excellent job of fundraising, and he has hired the Lincoln Strategy Group out of Arizona to manage the petition drive. This is the same organization which managed the petition drive to reinstate the death penalty in Nebraska. Altogether we need to collect 85,000 legitimate signatures. These signatures must comprise five percent of voters from at least 35 different counties, and the petitions must be submitted by July 5 in order to get the measure on the November ballot. If you would like to donate time or money to our cause, or if you would like to see how much money you could save, then please visit http://www.yestopropertytaxrelief.com.

On Thursday a public hearing was held on my bill to raise the rate of pay for gas commissioners. The hearing for LB 713 was held in the Natural Resources Committee, instead of the Revenue Committee or the Appropriations Committee, because gas commissioners do not get paid out of the state’s General Fund. Instead, the Nebraska Oil and Gas Conservation Commission’s operational costs are paid by the conservation tax proceeds collected by the Nebraska Department of Revenue from a tax assessed on the value of all oil and gas produced in the state.

Gas commissioners have never received a pay raise. The current rate of pay for gas commissioners is $50 per meeting with a cap set at $2,000 per year, which was set back in 1959. Therefore, LB 713 will raise their pay to $500 per meeting with a cap set at $6,000 per year. According to the website http://www.dollartimes.com $50 in 1959 is worth $426.51 today, so $500 per meeting seems liked a reasonable amount to me.

Finally, on Friday a public hearing was held on my agricultural land valuation reform bill, LB 1100. Because the bill I introduced last year stalled in the Revenue Committee, I decided to introduce an even better bill this year. LB 1100 will change the method for valuating agricultural land from the current market based system to a productivity method. LB 1100 would make agricultural land valuations fair, objective, and transparent.

Sen. Steve Erdman

District 47
Room #1529
P.O. Box 94604
Lincoln, NE 68509
Phone: (402) 471-2616
Email: serdman@leg.ne.gov
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