A public hearing on a proposed property tax relief package that was scheduled for Thursday, April 18, was postponed until Wednesday, April 24 at 4:00 p.m. in Room 1510 of the State Capitol. The hearing was delayed so that an amendment to LB289 could be drafted and made available for public review. The amendment, AM1381, is available here.

 

The proposal contains elements affecting the Revenue, Education, and Retirement Systems Committees. Sales taxes would be increased by three-fourths of one cent to help fund more than $500 million in property tax relief through increased state aid to schools. Property valuations would be reduced to 90 percent of actual value for commercial and residential property and to 65 percent of actual value for agricultural and horticultural land. Currently these classes of land are valued at 100 percent and 75 percent, respectively.

 

Other sections of the amendment would eliminate sales tax exemptions on soda and candy, as well as exemptions for plumbing, moving and certain veterinary services for pets. Cigarette taxes would be increased by 36 cents per pack with the additional funds credited to the Property Tax Credit Cash Fund.

 

The Revenue Committee has not yet voted to advance the proposed property tax relief package to the full legislature. Governor Ricketts opposes the package, instead supporting LR8CA, his proposal to constitutionally limit property tax increases to three percent. Should LB289 be advanced to the floor, it is likely to need at least 33 votes to overcome a filibuster and then 30 votes to override a gubernatorial veto.

Counties would receive an increased commission for collecting motor vehicle sales taxes under LB237 that advanced from General File on Tuesday. The commission would not increase the amount of taxes collected but would redistribute motor vehicle sales taxes that are distributed to counties and cities through the Highway Allocation Fund.

 

Until 2002, counties, retailers, and others collecting sales taxes on behalf of the state were paid a commission of 2.5 percent on the first $3,000 of collections and 0.5 percent on amounts in excess of $3,000. The distribution was altered in a special session during the 2002 budget crunch so that only the 2.5 percent commission on the first $3,000 of collections remained, thereby capping the total amount of commissions at no more than $75 per month, regardless of the amount collected.

 

LB237, as introduced, would return to the 2002 formula by adding an additional 0.5 percent commission on motor vehicle sales taxes collected by county treasurers in excess of $3,000 per month. New language would dedicate 25 percent of the commission to the county road fund and 75 percent to the county general fund. Retailers would not receive an increased commission other sales tax collections.

 

A Revenue Committee amendment would require counties with a population in excess of 150,000 to remit one dollar for each of the first 5,000 vehicles registered to the Department of Revenue to defray the costs of implementing the bill.

 

When a speaker priority designation was sought, Speaker Jim Scheer asked to have the formula adjusted so that no counties would lose money under the new formula. That led to an amendment changing the reinstated tier of the formula to kick in at $6,000 of collections. The amendment was adopted before the bill advanced.

 

During debate, Senator Joni Albrecht offered a floor amendment that would change the internal distribution to a 50/50 split between the county general fund and road fund. The amendment was not adopted and the bill advanced from General File.

 

Senator Sue Crawford introduced LB237 as part of her ongoing efforts to eliminate unfunded and underfunded mandates on county government. In 2014, she introduced LR582, an interim study to examine the impact of unfunded and underfunded mandates to counties and their impact on property taxes. Since then she has introduced several pieces of legislation to reduce or eliminate the mandates identified in the report, including returning motor vehicle sales tax commissions to earlier levels.

A bill to prohibit the use of eminent domain by private companies for wind energy projects was replaced with a compromise amendment outlining the intent of the State of Nebraska to protect its land, natural resources and cultural resources for economic and aesthetic purposes. The amendment, which replaces LB155 as introduced, specifically addresses the Sandhills' value as a migratory bird habitat, the site of natural resources, and the home to archaeological sites of significance to American Indians.

 

LB155 was introduced and prioritized by Senator Tom Brewer. It was debated in late February and failed to advance on a 23-8 vote, with 14 senators present and not voting. Twenty-five votes are needed to advance a bill. Later, Senator Robert Clements prioritized the bill and a second round of General File debate took place on Wednesday. The bill advanced with a 40-1 vote with five senators not voting.

 

LB700, a bill to require decommissioning and reclamation of wind energy conversion facilities, has appeared on the agenda for General File debate this week and is likely to be debated next week. A Natural Resources Committee amendment would replace the bill. It would require information to be provided to landowners about the materials and equipment that would be removed from and that would remain on the property when a wind turbine is decommissioned. Wind energy agreements executed on or after January 1, 2020 would have to provide for the removal of foundation material and equipment below grade and restoration of any void to the condition of the land prior to the installation. Political subdivisions could enact standards that exceed the requirements of the bill.

Senator Bruce Bostelman introduced LB700 and the Natural Resources Committee designated it as a priority bill.

After a short discussion on whether a vote of the people should be required in order to implement a county sales and use tax, the Legislature passed LB472 on Thursday, April 19. The bill creates the Qualified Judgment Payment Act to allow counties to impose a half-cent sales and use tax to help pay for federal judgments that exceed $25 million. An affirmative vote of two-thirds of the elected county board would be required to enact the tax. The tax would terminate after the judgment is paid in full or after seven years, whichever is earlier. Counties already subject to a county sales tax could not impose a sales tax under the Act to pay for a federal judgment. Counties imposing a sales and use tax under the Act would be required to set their property tax levy at the maximum rate for each year that the sales and use tax is in effect. The Act would terminate on January 1, 2027.

 

Senator Myron Dorn, a former Gage County supervisor, introduced and prioritized LB427 to help Gage County pay a $28.1 million judgment for the wrongful conviction of six Beatrice residents. With the addition of attorney fees and interest, the county must pay approximately $31 million.

Bills Reported to General File

The Judiciary Committee sent several bills the floor this week including LB387, a bill to create the Jury Selection Act to update and clarify jury procedures. The Act would modernize terminology and current practices in the selection of jurors. Senator Patty Pansing Brooks introduced LB387 and carried similar legislation for NACO in 2016 and 2017. Those bills had been advanced by the Judiciary Committee but not debated due to lack of time.

Bills Debated on General File

Bills on General File, the first round of debate, were on the agenda early in the week. On Thursday, the final day of debate before a four-day weekend, senators took up bills on Final Reading and Select File.

 

LB138, as advanced from General File, would create several specialty license plates for persons who have served in the armed forces as well as new Support Our Troops license plates for persons who have not served but want to support servicemembers. Money generated from sales of the Support Our Troops plates would be used to fund a veterans' workforce development coordinator at the Department of Labor. The new position was originally part of Senator Patty Pansing Brooks' LB626. Provisions from LB696 and LB697 were also incorporated into the bill.

 

As introduced, LB496 would increase penalties for tampering with witnesses, informants, juries, and physical evidence so that the tampering sentence would match the underlying felony charge. A Judiciary Committee amendment would reduce the tampering penalty to a Class I misdemeanor when the underlying criminal proceeding alleges a Class II misdemeanor or lower. The bill advanced from General File on a 38-0 vote.

 

LB657 would allow Nebraska farmers to grow hemp as a commercial crop. Growers would have to be licensed and fields identified by maps and GPS coordinates. The bill advanced from General File after nearly three hours of debate.

 

LB693 would allow the Attorney General to recover a civil penalty from persons transmitting incorrect phone caller-ID information with an intent to defraud, cause harm, or wrongfully obtain anything of value. Senators shared their experiences with such calls, sometimes called spoofing, before the bill advanced.

 

Senators debated LB550, a bill to require voter approval of fees and taxes on wireless services, but debate ended without a vote. Much of the discussion focused on an amendment that would replace the bill with a requirement for voters to approve increases in municipal occupation taxes on cell phones.

 

Likewise, debate ended without a vote on LB424, a bill to revise the Nebraska Municipal Land Bank Act. It would allow any municipality to create or join a land bank. Currently only municipalities in Douglas and Sarpy County are eligible to create land banks. Land banks can acquire and develop vacant and tax-delinquent properties.

 

Both bills may reappear on the agenda if the introducers can demonstrate sufficient support to overcome a filibuster and invoke cloture.

 

Bills Debated on Select File

Debate began on LB177, a bill to extend the termination date for bonding authority for the Papio Missouri Natural Resources District by ten years. It was scheduled to sunset in 2019. An amendment was offered but not debated to require bonds issued by public building commissions to be submitted to voters. Refunding bonds would not be subject to a vote but would require a certification by the county treasurer that the bonds would not increase property taxes or the bonded debt of the commission, county, or city. If the Secretary of State does not receive or does not approve such certification, voter approval would be needed.

Debate on LB177 will resume shortly after 9:00 a.m. on Tuesday, April 23. 

 

Bills Passed on Final Reading

The Legislature passed 14 measures on Thursday. Governor Ricketts has five days, excluding Sundays, to decide whether to sign or veto legislative bills or to decline to act. Constitutional amendments, such as LR14CA, are presented to the Secretary of State and appear before voters at the election specified in the legislative resolution.

 

LB212 would harmonize deadlines for the publication of proposed budget statements by counties and other entities to match language adopted in 2017. It incorporates publication language from LB191 and LB239, which was introduced by Senator Myron Dorn at NACO's request. The bill would also expand the use of technology by certain public entities that are already permitted to conduct meetings by video or telephone conference.

 

LB390 would require memorandums of understanding between schools and law enforcement agencies with officers serving as school resource officers. School administrators and officers would be required to attend at least 20 hours of training and maintain records of referrals for prosecution.

 

LB352 would require prosecutors to track the testimony of jailhouse informants who ask for or receive leniency due to their statements about inmates and other defendants.

 

LB320 would revise the Pesticide Act by updating federal regulations and clarifying product registration requirements.

 

LR14CA would extend the maximum duration of tax increment financing (TIF) projects by five years in areas where more than one-half of the property in the project areas is designated as extremely blighted due to a high rate of unemployment combined with a high poverty rate. The proposed constitutional amendment will appear before voters at the general election in November 2020. 

 

Bills Signed by Governor Ricketts

Among the bills signed by Governor Pete Ricketts on April 17 are measures to revise the county retirement plan and clean up motor vehicle statutes.

 

LB34 strikes authority for a member of the county or state retirement plans to receive a distribution of up to $25,000 during the pendency of a grievance. It clarifies that permanent county employees must be at least 18 years of age to participate in the county retirement plan. It identifies the current spouse of a retirement plan member as the beneficiary if the member dies without designating a beneficiary.

 

LB270 is a Department of Motor Vehicles clean-up bill that updates and harmonizes statutes and implementation dates.