State Director Bob Hallstrom reports from Lincoln on the small-business agenda for the legislative and political week ending April 9

Early next week, the Legislature will have completed two-thirds of the 2021 Legislative Session. Lawmakers continue to methodically process priority bills and are expected to give final approval to the biennial budget by the end of next week.

Budget Bills Advance

Lawmakers gave first-round approval on Thursday to the majority of the bills contained within the state’s biennial budget. The remaining budget bill (Legislative Bill 383) was expected to elicit extended debate on Friday pursuant to an amendment proposed by Appropriations Committee Chairman John Stinner (Gering) that would allocate nearly $15 million toward planning for a new correctional facility. In the only change to the proposed Appropriations Committee budget, Sen. Mike Flood (Norfolk) successfully promoted an amendment to increase grant funding available to creative districts (cultural and artistic ventures) from $100,000 a year to $1 million a year. Over the course of the next two years, state revenue is forecasted to grow by 1.4 percent in year one and 4.7 percent in year two.

Highlights of the Budget

Among the highlights of the $9.7 billion, two-year state budget plan are the following:

• Strong Cash Reserve: The cash reserve would be increased from $412 million to $763 million, with $50 million reserved to attract the U.S. Spacecom Project.

• Additional Property Tax Relief: The Property Tax Credit Fund would be increased by $63 million over the two-year budget cycle. In addition, funding for the refundable income tax credit against school district property taxes paid will increase from $125 million in fiscal year 2021-22 to $313 million in fiscal year 2022-23. As advanced, the budget package would place $1.45 billion into direct property tax relief over the two years ending June 30, 2023, a 65 percent increase from current property tax relief efforts.

• Increased Service Provider Rates: DHHS and juvenile provider rates would be increased by 2 percent (total of $83.5 million) over the next two years.

• Funding for Legislative Priorities: An additional $211 million is available for legislative priorities, either in the form of increased spending or by providing funding for tax relief measures.

The Nebraska Economic Forecasting Advisory Board will convene on April 29, 2021, to update current revenue projections upon which the state budget is based.

Property Tax Transparency Bill Moves

Legislative Bill 644 – Property Tax Request Act: The Legislature advanced LB 644 to Select File during floor action on Wednesday, April 7. Under LB 644, introduced by Sen. Ben Hansen (Blair), designated political subdivisions would be required to explain how much a property taxpayer’s bill would increase if the proposed tax increase were approved and hold a hearing on these tax increases after 6 p.m. to allow citizens to better participate in the process. As amended, the measure would require counties, cities, school districts, and community colleges to comply with certain notice and hearing requirements prior to setting the property tax request in an amount that exceeds the property tax request for the prior year, accounting for allowable growth (growth and assessed value of property from the prior assessment year to the current assessment year) resulting from (1) annexation of property; or (2) development of property. (NFIB Position – Support)

Virtual Small Business Day a Success

Approximately 50 small-business owners participated in this year’s virtual Small Business Day at the Capitol on Wednesday morning to learn about legislative issues of interest to the business community. Participants were treated to presentations by Gov. Pete Ricketts, Speaker Mike Hilgers (Lincoln), Revenue Committee Chair Lou Ann Linehan (Elkhorn), Appropriations Committee member Mark Kolterman (Seward), and Sen. Tom Briese (Albion), Sponsor of the COVID-19 Business Liability Protection legislation (Legislative Bill 139).

Small Business Day at the Capitol was co-hosted by NFIB, Nebraska Chamber of Commerce and Industry, the Greater Omaha Chamber of Commerce, the Lincoln Chamber of Commerce, Lincoln Independent Business Association and Nebraskans for Workers’ Compensation Equity and Fairness.

Previous Reports and Related Information

• April 8—2021 Small Business Day at the Capitol was the Best Yet

• April 2—Tax Reform/Relief Bills Advance

• March 26—Lawmakers Putting Finishing Touches on State Budget

• March 19—Nebraska Legislative Session Crosses Midway Point

• March 12—Budget Proposal Would Allocate $1.1 Billion in Nebraska Property Tax Credits

• March 5—Bill Limiting Property Tax Increase Advances

• February 26—A $20-an-hour Minimum Wage?

• February 19—Nebraska Legislature a Third of the Way Through its Session

• February 18—News Release: Liability Protection Bill Gets First Hearing This Morning

• February 12—NFIB Members Weigh in on Paid Leave Bill

• February 5—Busy Week of Testimony on Small Business Bills

• January 29—NFIB Testifies on Four Bills—More Testimony Coming Up

• January 22—Bill Introduction Deadline Passes—Hearings to Commence

• January 15—The Legislative Bill Mill Starts Turning

• January 14—Small Business Comments on Governor’s State-of-the-State Address

• January 8—Nebraska Legislature Begins New, Two-Year Session