Senators have passed the halfway point in the 2020 session, and there is a bit of heavy lifting to do before the scheduled April 23 adjournment.
Committee hearings concluded at the end of last week and full day floor debate begins today. With senator and committee priority bills designated, the way forward is a little clearer.
Property Tax: Floor debate opened last week on LB 974, the Revenue Committee’s property tax and school funding proposal. The bill ran into the Speaker’s three-hour rule, which requires its sponsors to round up the support of at least 33 senators before further consideration is scheduled. The basics of LB 974 are lowering the taxable value of property and changing the amount of state aid to schools. In addition to the classic TEEOSA equalization aid, state assistance would include foundation aid (a per-student payment) for school districts that do not receive TEEOSA funding.
Granted, changing the state aid formula is not easy. Designed to take into account the varying needs of different schools and balance those with local revenue, it is already very complicated. Making even small adjustments can create more issues. Then again, the Legislature has been making such adjustments since TEEOSA was enacted in 1990.
LB 974 has the support of agricultural organizations and some business groups. Opposition from school districts appears to be universal. The schools’ opposition centers on two elements: Apprehension that the level of state funding that would make up for the loss of local property tax revenues would not continue after three years, and new budget restrictions that would limit school spending growth to the inflation rate, with a cap of 2.5 percent, and new construction value.
There is also some concern in the business community over provisions of the bill, e.g. lowering taxable agricultural land values to 55 percent of market, that could shift more of the burden to commercial property.
Members of the Revenue Committee are looking for ways to address concerns, while keeping those supporting the current proposal on board.
ImagiNE: LB 720 received a second Revenue Committee hearing to consider amendments to the bill, including technical adjustments and the addition of a new tier aimed at retaining large employers that are acquired by other companies and are in danger of locating to another state. It is anticipated that the amendment will also include the Nebraska Transformational Projects Act (aka NeXT), which is intended to enable efforts such as UNMC’s infectious disease response facility.
So, what’s the holdup? Some senators remain adamant that the incentives bill must not proceed until a property tax measure does. LB 720 remains at the second stage of floor debate, and advancing to Final Reading is being held up (at least for now) until the property tax bill catches up.
Meanwhile . . .
Chamber members and staff offered testimony in various committees on issues such as workforce development, business and community development, small and emerging business contracting, and foreign sourced business income taxation. Thanks to all our volunteers and staff who made the trek to Lincoln this session.
In between filibusters, senators have been moving legislation. Twenty-one bills have been signed into law, and 11 more await a final vote. Selection of priority bills was completed last Friday. (Senators get to designate one; most committees get two; and the Speaker will add 25.) It is likely that from here on out, only priorities will appear on the agenda (and a priority designation does not guarantee time for floor debate).
Finally, in the something-you-don’t-see-every-day department: last week there were testifiers in the Judiciary Committee openly carrying assault rifles. Just making their views known.
Senior Director, Public Policy
808 Conagra Dr., Ste. 400, Omaha, NE 68102
Lincoln Office: 402-474-4960
Refer to the Public Policy page on the Greater Omaha Chamber’s website or contact Jennifer Creager or Tim Stuart at 402.474.4960 if you have questions.
Also, click here if you are interested in reading the Legislature’s Update of the happenings in Lincoln.