LINCOLN–The 2019 Nebraska unicameral session had its ups and downs, but it ended May 31 marked by little action on two of the Legislature’s biggest priorities at the session’s outset.
Rural senators stressed the importance of property tax relief over the course of the session, but their two main proposals — introduced by Sens. Lou Ann Linehan of Elkhorn and Tom Briese of Albion, respectively — failed to resonate with urban senators and Gov. Pete Ricketts. Both proposals involved using new taxes on items like candy and bottled water to slash property tax needs. Ricketts viewed both proposals as ineffective redistributions of taxes, and both proposals failed to gain two-thirds approval from the Legislature.
As supporters of property tax relief, many such rural senators set out to thwart an economic development bill, dubbed the ImagiNE Act, which would have created new tax incentives for businesses. Sens. Curt Friesen of Henderson and Mike Groene of North Platte opposed the bill because they said property tax relief was the wiser use of taxpayer money. They led the charge against the bill, stopping it at 30 votes in favor, just shy of the 33 votes necessary to pass the bill.
Friesen said it is unclear whether the tax incentives are effective in creating job growth. But Groene offered an olive branch to state business groups, hoping to compromise with a bill packaging property tax relief and tax incentives for businesses in the next legislative session.
The ImagiNE Act would have sought to clear up the question of whether tax incentives for businesses actually benefit the economy. The bill also aimed to improve employment in blighted areas and would have rewarded companies that paid their employees above-average wages. In place of the proposed bill remains the 14-year-old Nebraska Advantage Act, which functions similarly but has ended up costing between $120 million and $150 million per year — more than double its originally proposed yearly price tag.
Despite the contention involving property taxes and tax incentives, the Legislature passed a two-year, $9.3 billion state budget relatively easily. The budget most notably includes $1.2 billion to the University of Nebraska system, $2 billion to K-12 education, $51 million extra to the Property Tax Credit Cash Fund (bringing the fund’s total to $272 million), new funds for Medicaid expansion and $54.7 million to cover costs for the construction two new high security correctional facilities.
The budget passed on a 35-12 vote and was signed by Ricketts. But a number of senators were less than satisfied with the budget, such as Sen. Steve Erdman of Bayard, who worried that the new budget would make it more difficult to lower taxes.
“We can’t lower taxes until we learn how to control spending, and that budget did not do that,” Erdman said.
Though the budget did add funds to the Property Tax Credit Cash Fund, Erdman was not content in that respect either.
“That’s not sufficient enough, we need to figure out a way to cut spending, and then we’ll figure out how to fix our tax system,” Erdman said. “But we can’t continue to grow the budget like we have over the last 15-20 years and expect people to be happy with it.”
Ricketts, however, was pleased with the budget and the $550 million in property tax relief it will allow.
“Our ongoing commitment to controlling spending helped the state do property tax relief this year, and has set the state up to expand relief in years to come,” he said.
Despite mild success with priority measures, the Legislature still managed to pass more than 250 bills in the 2019 session. Below is an overview of the most notable new measures.
- LB 209, Sen. Joni Albrecht, Thurston: Under this bill, abortion providers will be required to make patients aware of their ability to reverse an abortion after taking one of the two pills used to end a pregnancy.
- LB 630, Sen. Adam Morfeld, Lincoln: This measure outlaws “revenge porn,” or harassing people through threatening to send or share sexually explicit digital images of that person.
- LB 519, Sen. Julie Slama, Peru: The first-year senator’s bill regarding prosecution of sex traffickers passed unanimously. It allows law enforcement to tap phones of traffickers and expands the statute of limitations for the crime from three to seven years, while abolishing the statute of limitations for trafficking cases involving minors.
- LB 657, Sen. Justin Wayne, Omaha: The hemp industry is growing, and legislators voted to allow Nebraskans to grow and sell the product, which produces cannabidiol, aka CBD, as long as it contains less than 0.3 percent THC, which creates the psychoactive effect in marijuana. Medicinal marijuana will remain illegal, but senators are pushing for the public to be able to make the decision in the 2020 elections.
- LB 149, Sen. Dan Quick, Grand Island: The vaping and tobacco use age will rise one year to 19. The measure will take effect on Jan. 1.
- LB 610, Sen. Brett Lindstrom, Omaha: This bill, among other things, will create a college savings fund for every child born in the state. Each account will start with $100.