Governor Lauds Tax Cuts, Transformational Investments In Water Recreation
LINCOLN — The 2022 session of the Nebraska Legislature ended Wednesday with a mixture of accolades for passage of big tax cuts and investments in water recreation, and frustration over the blockage of proposals dealing with concealed handguns, abortion and criminal justice reform.
It was an unusual 60-day session that required the passage of two supplemental budgets — one to parcel out healthy cash reserves and another to hand out a more than $1 billion influx from the federal American Rescue Plan Act (ARPA).
In between, senators passed a multi-faceted tax cut bill that over time will lower the state’s top individual and corporate income tax rates, phase out taxes on Social Security and provide additional state tax credits on property tax payments.
Legislative Bill 873, which will provide nearly $950 million in yearly tax breaks by 2028, was hailed by Gov. Pete Ricketts as “truly historic” during his farewell address to state lawmakers Wednesday.
The Republican governor added that the annual impact from the bill will be 12 times greater than any previous tax-cut bill passed by the Legislature and signed into law.
Speaker of the Legislature Sen. Mike Hilgers of Lincoln called the session a “smashing success” of passing bills that will have an impact for generations.
Hilgers cited not only the tax cuts and responsible state budgeting, but also the $200 million devoted to improvements at Lake McConaughy, Lewis & Clark Lake and Niobrara State Park, along with research and planning funds for a huge sandpit lake between Omaha and Lincoln.
Three controversial measures were blocked from advancing by filibusters, including a bill that would “trigger” a ban on abortion in Nebraska if Roe v. Wade is struck down by the U.S. Supreme Court and a bill that would have allowed Nebraskans to carry concealed handguns without obtaining a state permit and passing a gun safety course.
Gordon Sen. Tom Brewer has vowed to continue his fight to pass a permit less concealed carry law, while an opponent of the bill and one of the leading progressives in the Legislature, Omaha Sen. Megan Hunt, called 2022 “an improbably successful session.”
“We overrode the governor’s veto on funding for developmental disabilities, Medicaid, behavioral health, child welfare and other life sustaining programs,” Hunt said.
She noted also that bills didn’t pass that would have required voter ID, blocked teaching of critical race theory and eroded rights of the LGBTQ community.
But conservatives also had victories this year. They blocked a criminal justice reform proposal that grew out of a study by the nonprofit Crime and Justice Institute of Nebraska’s sentencing laws and prison/parole system.
Sen. Steve Lathrop of Omaha, who sponsored the CJI bill, said he hopes the next Legislature will be more receptive to sentencing reforms. He has said such reforms are essential if Nebraska is to avoid building two new prisons, at a cost of more than half a billion dollars.
He said Wednesday that LB 920 was blocked by a filibuster, in part, because conservatives felt it was “soft on crime” and wanted to make a political point during an election year.
Consideration of building a new, $260-million prison to replace the State Penitentiary in Lincoln was put off until next year, though $175 million in funding for the project was set aside for construction.
Omaha Sen. John McCollister said he was disappointed the tax cuts didn’t provide more relief for middle- and lower-income families.
Only couples making more than about $60,000 will see a drop in state income taxes, though the governor and others said lower income groups will see tax relief indirectly, through lower property taxes and the eventual elimination of state taxes on Social Security.
State business groups hailed the tax cut bill, saying it will make the state more competitive with its neighboring states, where taxes are generally lower. But the Lincoln-based think tank OpenSky Policy Institute has criticized the tax cuts as reducing state revenue too deeply, eventually requiring reductions in spending on K-12 schools and other state priorities.
Thirteen senators who will leave the Legislature after 2022 gave emotional farewell speeches to colleagues before the session ended sine die.
McCollister said he’d been chased by turkeys, was peed upon and fell through a porch while campaigning for the $12,000-a-year job. When people along the campaign trail asked why he sought such a job, with such low pay and long hours, the senator said he responded: “The psychic income was enormous.”
A tradition on the last day of a state legislative session is for lobbyists and some staff to wear seersucker clothing. (Paul Hammel/Nebraska Examiner)
Omaha Sen. Robert Hilkemann drew laughs with his story of how he served as temporary governor when the elected governor and lieutenant governor were both out of state. The senator said there were no emergencies during his short stint, but he was able to make all his grandchildren and several friends honorary admirals in the mythical Nebraska Navy.
Among the other accomplishments in 2020:
• North and South Omaha investment. Provides $335 million for job training, small business growth, economic development and affordable housing in metropolitan areas and other qualifying census tracts.
• Broadband. Allocates $40 million for broadband improvements in rural communities of 5,000 or less.
• Rural medical school. Sets aside $60 million to establish a medical school at the University of Nebraska at Kearney to address a shortage of nurses and doctors in rural areas.
• Provider rates. Overrode a gubernatorial veto to provide $51.8 million in pay increases to private providers of behavioral health, child welfare, developmental disability aid and Medicaid services. The 15% increase, advocates said, was needed to battle workforce shortages among those providers.
• Cash reserve. Despite all the spending, lawmakers left $1.2 billion in the state’s “rainy day fund,” which Gering Sen. John Stinner, who chairs the Appropriations Committee, called a hedge against any economic downturn.
• Perkins County Canal. Lawmakers set aside money to plan and develop the canal, which would divert water from the South Platte River in Colorado to enhance flows into Nebraska. Ricketts and water advocates say it’s the only way Nebraska can assert its legal right to water set aside in a century-old compact with Colorado, which they said would claim the water otherwise.
• Workforce development. Lawmakers devoted $60 million to community colleges and $15 million to high school programs to develop skilled workers in fields such as health care, agriculture, transportation, manufacturing and construction.
This story was originally published by Nebraska Examiner, an editorially independent newsroom providing a hard-hitting, daily flow of news. It is part of the national nonprofit States Newsroom. Find more at nebraskaexaminer.com.
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