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2019 Legislative Report Week 1 & 2

The 2019 legislative session has concluded its second week at a very swift pace. Upon the Legislature’s adjournment Friday morning, state senators had introduced 478 bills after eight legislative days completed in the 2019 session. In addition, several resolutions and constitutional amendments have been offered.

Only two days remain for new bills to be offered, as Wednesday, January 23, will mark the bill introduction deadline. Other key dates this session include March 19 – the deadline for senators and committees to designate priority bills – and March 20, when the speaker will announce his priorities. Priority bills are generally considered ahead of other bills in floor debate. Each senator may select one priority bill, while each committee may select two. The speaker may select up to 25 priorities.

State Of The State: Governor’s Budget Focuses On Property Taxes, Workforce:

During his State of the State Address to the Nebraska Legislature earlier this week, Governor Pete Ricketts called on lawmakers to expand state efforts to lower local property taxes, along with doing more to enhance Nebraska’s workforce.

The governor unveiled his $9.3 billion, two-year budget that would hold the state’s spending growth at 3.1%, compared to less than 1% under the current budget. Roughly two-thirds of the new budget’s growth would be due to funding increases for school state aid and Medicaid expansion. The governor’s budget includes a record $1.1 billion for K-12 education, while another $63.1 million would pay for voter-approved Medicaid expansion.

10 Key provisions in the governor’s State of the State Address and budget plan include:

Expansion of Property Tax Credit Program: Governor Ricketts called on senators to dedicate more funding to the state’s program designed to provide relief from locally imposed property taxes. The governor’s plan would increase funding for Nebraska’s property tax credit program by $51 million per year – for a total of $550 million over two years. This would take the annual total for the program to a minimum of $275 million, up from the current $224 million. For the owner of a $100,000 home, it would mean a $20 increase in what amounts to a $106 subsidy from the state.

Lid on Local Property Tax Increases: The governor also urged lawmakers to place a cap on the growth of local property taxes by imposing a 3% limit on the tax increases imposed by school districts, counties, cities and other local governments. The proposal, offered as a constitutional amendment (LR8CA by Elkhorn Senator Lou Ann Linehan), would require approval of the Legislature, as well as voters statewide. The amendment would not limit other sources of local government revenue, and local voters could override the lid.

Scholarships for Workforce Development: The governor spent considerable time of his speech to address workforce development. He called for the funding of 2,100 college scholarships to steer young people to high-demand career fields. These “talent scholarships” would be used at NU, state universities and community colleges in fields such engineering, health care and computer science. He also proposed an additional $1.25 million for the Developing Youth Talent Initiative, which encourages middle school students to learn about the fields of manufacturing and information technology.

Increased Funding for Higher Education: The governor proposed funding levels of $609.2 million for the University of Nebraska system, $54.8 million for state colleges, and $102.6 million for community colleges, all increases from current levels.

Rewrite of Nebraska’s Business Incentives: The governor briefly mentioned the need to reauthorize or rewrite the state’s primary economic development tool – the Nebraska Advantage Act, which expires next year. He called incentives an “important tool” used all across the nation, and told senators that Nebraskans want tax policy that is “simple, transparent, accountable, and attracts higher-paying jobs.”

The governor’s address made no mention of the need for state income tax relief. Nebraska’s top personal income tax rate (6.84%) is 16th highest in the country, and the state’s personal income tax collections have grown by $846 million over nine years. Nebraska’s top corporate tax rate (7.81%) is also the nation’s 16th highest.

Now that the governor has put forth his budget, the Legislature’s Appropriations Committee will craft its own spending proposal and present it to the full Legislature later this session. The committee will produce its preliminary budget report in early March after the state economic forecasting board updates its projections. Final budget bills must be on General File no later than May 2 – the 70th day of the session – so that the full Legislature has adequate time to debate and vote on the package.

The Tri-City Legislative Luncheons:

For now the luncheons have been cancelled due to the State Capitol renovation. It is the Hastings Area Chamber of Commerce’s year to plan the Luncheons and they have spent countless hours with no solution. Members of the Kearney Area Chamber of Commerce’s Legislative Committee have suggested a couple of alternate locations to meet in Lincoln including UN Foundation Office, the Education Building, and the State Building Division, all located in close proximity to the Capital. The committee will continue to see if there is any availability.

The Nebraska Chamber's Annual Meeting and Legislative Caucus:

The annual event will be held Thursday, February 7, 2019, at the Cornhusker Marriott Hotel in Lincoln. This is one of Nebraska's most recognized business events of the year.

Those attending will have an opportunity to hear from key state lawmakers and policy experts, as well as attend briefings on issues of concern to the business community. Afternoon discussion panels will include the traditional Legislative Leaders panel.

The following are the key 2019 dates for Nebraska lawmakers this session:

● January 9-23 - Introduction of new bills.

● January 15 - Governor's State of the State Address (10 a.m. CT).

● January 15 - Deadline for governor to submit budget plan.

● January 22 - Afternoon hearings begin on new bills (1:30 p.m. CT).

● January 23 - Last day of bill introduction.

● March 14 - Deadline for speaker priority bill requests.

● March 19 - Deadline for committee & senator priority bill designations.

● March 20 - Speaker priority bills announced.

● March 28 - Deadline to complete bill hearings.

● April 2 - Full-day floor debate begins.

● May 2 - Budget bills must be on General File.

● May 22 - Budget bills must be passed.

● June 6 - Sine die adjournment.

The Chamber will be hosting a morning “Legislative Report” with Senator Lowe in the future. We will give more information as we get it.

Have a great week!

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