Committee hearings begin January 22
State Director Bob Hallstrom reports from Lincoln on the legislative week ending January 18
As of January 18, the eighth day of the 2019 legislative session, a total of 478 bills and four proposed constitutional amendments have been introduced. With two days left for bill introductions, the total number of bills this session may exceed the number introduced in recent years.
Committee hearings will begin January 22 and continue through the latter part of March. Floor debate on bills advancing from committee to General File is expected to begin later next week.
Governor’s State of the State Address
Gov. Pete Ricketts presented the annual “State of the State” address January 15, calling for property tax relief, limited spending growth, and reduced regulatory red tape.
The governor will be:
- proposing an additional $51 million annually for the Property Tax Credit Cash Fund
- establishing minimum funding of $275 million annually for the Property Tax Credit Cash Fund
- imposing a 3 percent cap on increases in property taxes levied by local governments.
The governor’s current budget proposal would limit increases in spending to 3.1 percent. A majority of the proposed budget growth would result from funding increases for state aid to schools and Medicaid expansion. The budget also contains increased funding levels for higher education.
Citing the need to “grow” Nebraska, the governor is promoting workforce development through funding for “talent scholarships” to direct college students to high-demand career fields and an additional $1.25 million in funding for the Developing Youth Talent Initiative, which encourages middle school students to learn about the fields of manufacturing and information technology.
Workers’ Compensation Legislation
Legislative Bill 139 – Workers’ Compensation – Contractor Registration Act:
Sen. Mark Kolterman (Seward) has introduced legislation (LB 147) that would expand the existing Contractor Registration Act to require the database of contractors registered under the Act to include the following information with respect to each registered contractor: (a) whether the contractor carries workers’ compensation insurance in accordance with the Workers’ Compensation Act; (b) whether the contractor is self-insured; and (c) whether the contractor is not required to carry and does not carry workers’ compensation insurance. The bill would create a presumption of no coverage that may be rebutted by an insurer acknowledging coverage for a claim-covered event in cases in which the contractor is not required to carry and does not carry workers’ compensation insurance.
Legislative Bill 360 – Workers’ Compensation – Nonresidents Alien Dependents:
Introduced by Sen. Matt Hansen (Lincoln), LB 360 would provide for settlement of claims of nonresident alien dependents by authorizing a nonresident alien dependent, at any time prior to the final settlement, to file with the Workers’ Compensation Court a power of attorney designating any suitable person residing in the state to act as an attorney in fact in Workers’ Compensation Court proceedings. The bill would allow the power of attorney to act as attorney-in-fact for the nonresident alien in court proceedings if the court determines that the interests of the nonresident alien dependent will be better served by the attorney in fact than by the consular officer. The attorney-in-fact would be required to furnish a bond satisfactory to the Compensation Court conditioned upon the proper application of any money received as compensation under the Workers’ Compensation Act.
Legislative Bill 364 – Workers’ Compensation – Medical Reports:
Sen. Dan Quick (Grand Island) has introduced legislation (LB 364) that would prohibit a provider or supplier of services to collect from any employer, insurer, government, or injured employee or dependent, any amount in excess of the fee established by the Compensation Court for an opinion or report addressing medical condition, causation, or disability.
Legislative Bill 408 – Workers’ Compensation – Death Benefits:
Senator Quick is also sponsoring LB 408 which would provide, upon the death of an employee, if there is no spouse, child, or other dependent entitled to benefits, that $25,000 is to be paid to the personal representative of the estate of the decedent.
Legislative Bill 418 – Workers’ Compensation –Debt Collection:
Under LB 418, introduced by Sen. Michaela Cavanaugh (Omaha), collection agencies would be required to cease attempts to collect a debt if a case is pending in the Nebraska Workers’ Compensation Court and the debt is alleged to be subject to Section 48–120 (medical, surgical and hospital services).
Legislative Bill 448 – Workers’ Compensation – Burial Benefits:
Sen. Mike McDonnell (Omaha) has introduced legislation (LB 448) that would revise the manner in which an employer’s responsibility for burial expenses is determined by setting the burial expense at 14 times the state’s average weekly wage to be automatically adjusted annually.
Taxation
Legislative Bill 50 – Income Taxation:
Introduced by Sen. Tony Vargas (Omaha), LB 50 would, effective for taxable years beginning on or after January 1, 2019, establish an additional individual income tax rate bracket of 7.84 percent for incomes over $100,000 for single individuals and incomes over $200,000 for married filing jointly. The measure would also impose an additional tax of 1 percent on that portion of the taxpayer’s Nebraska taxable income in excess of $1 million and an additional tax of 2 percent on that portion of the taxpayer’s Nebraska taxable income in excess of $2 million.
Legislative Bill 182 – School District Local Option Income Surtax Act:
Sen. Kate Bolz (Lincoln) has introduced LB 182, which would authorize school districts to adopt a local option income surtax for property tax reduction, or building construction, remodeling, and site acquisition. (Local option income surtax would be equal to the individual’s state income tax liability, less any amount of nonrefundable credits allowed to such individual under state law, multiplied by a rate determined by the school board, not to exceed 20 percent.) The legislation would require approval of a local option income surtax by a majority of the registered voters in the school district and would limit the duration of the local option income surtax to a period not to exceed five years.
Legislative Bill 303 – Property Tax Credit Act:
Sen. Brett Lindstrom (Omaha) is the sponsor of legislation (LB 303) that would establish, for tax year 2019 and each tax year thereafter, the amount of relief granted under the Property Tax Credit Act in an amount not less than $275 million.
Legislative Bill 314 – Remote Sellers Sales Tax Collection Act:
A comprehensive tax reform package (LB 314) has been introduced by Sen. Tom Briese. The legislation would impose new and expanded taxes to provide approximately $470 million in property tax relief and significantly increase funding for state aid to schools. Various state taxes would be increased by an estimated $780 million.
The measure would a) increase the state sales tax from 5.5 percent to 6 percent; b) eliminate the tangible personal property tax exemption; c) eliminate itemized deductions; and d) increase alcohol and cigarette taxes.
In addition, the bill would also increase income tax collections by:
- Ending Nebraska’s S Corporation/LLC exclusion on out-of-state earnings
- Repealing the state’s special capital gains and extraordinary dividends exclusion
- Reinstating the alternative tax on high-income earners
- Adding a 7.84 percent surcharge on income over $250,000 for individuals and $500,000 for couples.
The following series of sales tax exemptions would be repealed:
- Candy, soft drinks, and bottled water
- Tangible personal property repair (motor vehicles)
- Pet-related services
- Real property remodeling, painting and repair and interior design for residential housing
- Personal care services including hair care, massage, tanning, nail, spa and tattoo services
- Storage and moving services
- Parking fees
- Clothing cleaning and repair
- Travel agency services
- Membership and admissions to zoos and aquariums
- Dating and escort services
- Taxi, limousine, and other transportation services
- Lawn care, landscaping and gardening
- Tele-floral
- Tour operators
- Historic automobile museums
- Swimming pool cleaning and maintenance
- Music, dance, golf and other recreational services
- Ride-sharing services (Uber and Lyft)
- Airbnb type services
The measure will also terminate the New Markets Job Growth Investment Act and earmark new sales tax revenues from online retail sales to property tax relief.
Legislative Resolution 8CA – Cap on Annual Property Tax Increases:
Sen. Lou Ann Linehan (Elkhorn) has introduced a constitutional amendment (LR8CA) to limit the growth of local property taxes. Under the measure, the ability of schools, counties, cities, and other local governments to increase property taxes would be limited. Property tax increases could not be more than 3 percent greater than the amount raised the prior fiscal year.
General Business Legislation
Legislative Bill 99 – Prompt Payment Act:
A measure sponsored by Sen. Justin Wayne (Omaha) would require state agencies to make payment in full for all goods delivered or services rendered by a creditor which is a small business on or before the 15th calendar day (45 calendar days for all other creditors) after (a) the date of receipt by the agency of the goods or services; or (b) the date of receipt by the agency of the bill for goods or services, whichever is later.
Legislative Bill 254 – Fair Chance Hiring Act/Ban the Box:
Introduced by Sen. John McCollister (Omaha), LB 254 would prohibit public and private employers and employment agencies from asking an applicant to disclose, orally or in writing, information concerning the applicant’s criminal record or history, including any inquiries on any employment application, until the employer or employment agency has determined the applicant meets the minimum employment qualifications. The bill would apply to employers with 15 or more employees.
Legislative Bill 305 – Healthy and Safe Families and Workplace Act:
Introduced by Sen. Sue Crawford (Bellevue), LB 305 would allow employees to accrue a minimum of one hour of paid sick time for every 30 hours worked, with a maximum of 40 hours of paid sick time accrued in a calendar year. Under the measure, employees would be entitled to use accrued paid sick time beginning on the 60th calendar day following commencement of employment. Paid sick leave would be authorized for: (a) an employee’s mental or physical illness, injury, or health condition; (b) an employee’s need for medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; (c) an employee’s need for preventative medical care; (d) care of a family member with a mental or physical illness, injury, or health condition; (e) care of a family member who needs medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; (f) care of a family member who needs preventative medical care; or (g) absence necessary due to domestic abuse, sexual assault, or stalking.
Legislative Bill 306 – Employment Security Law:
Senator Crawford has also introduced legislation (LB 306) that would provide that an individual leaving his or her employment to care for a family member with a serious health condition would constitute good cause for voluntarily leaving employment under the Unemployment Insurance Act.
Legislative Bill 311 – Paid Family Medical Leave Insurance Act:
Introduced by Senator Crawford, LB 311, beginning July 1, 2021, would establish a statewide paid family medical leave insurance program similar to Nebraska’s unemployment insurance system and managed by the state Department of Labor.
Legislative Bill 383 – Minimum Wage:
Legislation sponsored by Senator Quick (LB 383) would, beginning on January 31, 2020, and each year thereafter, provide for adjustment of the minimum wage by an amount determined by the state treasurer at the end of the preceding calendar year to reflect the average annual percentage change in the consumer price index the most recent five–year period for which data is available. The measure would limit the annual increase to no more about 3½ percent each year.
Legislative Bill 400 – Minimum Wage Tipped Employees:
Sen. Megan Hunt (Omaha) has introduced a measure that would increase the state minimum wage for “tipped” employees from the current rate of $2.13 per hour to $3.60 in 2020, and to $4.50 on January 1, 2021. The bill would also require the summary of the Wage and Hour Act posted by employers to include a summary of the minimum wage amounts in effect under the Act.
Legislative Resolution 7 – Constitutional Amendment – Convention of States:
A legislative resolution (LR 7) introduced by Sen. Steve Halloran (Hastings) would serve as Nebraska’s application for a Convention of States under the authority of Article V of the United States Constitution for proposing constitutional amendments. The resolution would limit the Convention amendment to: limiting the size and scope of the federal government; considering fiscal restraints; and term limits.
Small Business Day at the Capitol
NFIB will co-sponsor a Small Business Day at the Capitol April 17 in Lincoln.
NFIB’s co-sponsors are the Nebraska Chamber of Commerce and Industry, the Greater Omaha Chamber of Commerce, the Lincoln Chamber of Commerce, the Lincoln Independent Business Association and Nebraskans For Workers’ Compensation Equity and Fairness.
Small Business Day gives NFIB members an opportunity to network with other small business owners. Governor Ricketts is expected to speak, and there will be a legislative briefing by state senators.
Details on the time and location of Small Business Day at the Capitol will be released soon. Check www.NFIB.com/NE for the latest information.
Previous Legislative Reports and News Releases
January 15—Comment on Today’s State-of-the-State Speech
January 11—Nebraska Legislature Convenes, Committee Chairmen Elected
[Photo courtesy of Unicameral Update, the Nebraska Legislature’s official news source since 1977]
