Today is day 70 of the Legislature’s session. That leaves 21 meeting days to complete an ambitious agenda.
Though proceedings have been slowed by filibustering, progress has been made. In the last two weeks, five bills have received final approval, and 14 are in line for a final vote. Within some of those bills are many other measures. A committee often adds numerous proposals to a designated priority. A subsequent amendment can add even more. So, floor consideration and debate goes to 16 or 21 or whatever number of proposals in one. All have had full committee hearings; all get full explanation and debate. This is just a mechanism to move legislation during extended debate. Often, these so called “Christmas trees” (lots of ornaments) include bills that had no opposition in committee hearings.
Such progress, though, does not mean that the remainder of the session will proceed smoothly. As you are aware, the Chamber issued a public statement addressing the issue that is at the core of the delays. This is primarily LB 574, legislation that would restrict medical treatment for transgender people under the age of 19. Chamber leadership issued this statement not only because the filibustering has extended to so many of the unrelated proposals that Nebraska needs to adopt to further economic development efforts, including workforce attraction and development. It is also because this debate is damaging Nebraska’s efforts to be known as a welcoming and safe place. The tenor of the debate has not demonstrated “the best of Nebraska.”
Welcome to budget week.
Today the Appropriations Committee released its recommendation for a two-year state spending plan.
A bulk of the spending will come through LB 814, known as the mainline budget. Current General Fund outlays for FY22-23 are $5.16 billion. That is expected to grow by two percent or two and a half, maybe three. Senators are also free to vote on amendments that add or adjust funding for particular programs.
Though discussion often surrounds the General Fund (sales tax, individual income tax, corporate tax, and miscellaneous taxes), the mainline bill also directs revenues from other sources such as the highway cash funds (fuel, registration, vehicle purchases, and other user fees) as well as federal funds. This will include federal ARPA distributions for development projects.
State revenue projections also play a major role. Last week, the Nebraska Economic Forecasting Board met to discuss the state of the economy and the outlook for General Fund revenues. The forecast is used by the Legislature as a guide for approving appropriations. This also plays a role in revenue policy such as income tax rates. Though the Board did lower estimates for the current fiscal year (ending June 30), revenues are predicted to increase in following years.
Changes to tax policy will follow budget debate. Awaiting second round consideration are LB 754 (which includes lowering the two top individual and corporate income tax rates to 3.99 percent) and LB 243 (which would increase property tax credits, replace community college general fund levies with state funding, and further limit school district property tax growth). LB 754 also contains provisions such as eliminating taxation of occasional visitors to the state.
Waiting in the wings is LB 727, an omnibus tax proposal with 21 measures rolled in. These include bonding authority for highway construction, extending UNMC’s NExT project, and extending R&D tax credits, all Chamber priorities.
Other Chamber priorities are advancing either individually or as part of a larger package. One example is a provision to allow Department of Labor training funds to be utilized for employee retention. That is part of a Business and Labor Committee priority package (LB 191).
Days and evenings over the next few weeks are bound to be long. Afternoon sessions have often been running to 9:00 p.m., and some of those upcoming are likely to extend well beyond that. Be assured your Public Policy team is always there.
Jennifer Creager
Senior Vice President, Public Policy
808 Conagra Dr., Ste. 400, Omaha, NE 68102
Lincoln Office: 402-474-4960