Not a pretty picture
There’s speculation that Speaker Scheer may reconvene the Legislature in June if this COVID-19 thing straightens up. Seventeen days remain in the session. The first fiscal year (2019/20) of the state’s biennial budget ends June 30.
On March 12, four days before COVID-19 shut down the session, senators advanced two budget bills from General File to Select File. The resulting $9.4 billion Appropriations Committee Budget Proposal projected 5.2% growth in 2019/20 General Fund revenues. Projected growth for the second fiscal year (2020/21) was only 0.6%. COVID-19 blew-up those projections in just six weeks.
The proposed budget also reflected a very healthy balance of $731.1 million in the state’s Rainy-Day Fund (Cash Reserve Fund). With an $83.6 million appropriation on March 25 to help with the state’s COVID-19 response and a sure decline in revenues, the Rainy-Day Fund is certain to take a hit.
In an April 22 study commissioned by the Platte Institute, economists Ernie Goss and Scott Strain reported that in March and early April 2020, Nebraska experienced a loss of 96,147 jobs, and $46.2 million in state and local tax collections, for a total impact of $834.5 million.
By pushing the tax filing deadline to July 15, the IRS shifted a projected $385 million in taxes from the state’s FY2019/20 to FY2020/21. Additionally, some businesses and individuals impacted by the pandemic may not be able to meet their tax obligations.
How about some good news: Nebraska received $1.25 billion in the COVID-19 emergency relief funding from the federal government.
Don’t forget about Nebraska’s 530 municipalities that rely heavily on sales and use taxes to fund their budgets. With many Mainstreet businesses in lockdown, those revenues are not flowing to cities and villages. The state may have to step in and provide relief.
In case you missed it, Governor Ricketts will ease some COVID-19 restrictions beginning May 4.
- Hospitals may resume scheduled elective surgeries and procedures if 48% of hospital beds, 42% of ICU beds, and 74% of ventilators are available for use statewide as of April 24. Additionally, each facility must have two weeks’ worth of PPE on site.
- Dentists and veterinarians can get back to work.
- Rather than a single statewide Directed Health Measure (DSM), the Governor will more effectively manage regional conditions by issuing unique DSM’s for each of Nebraska’s 19 local health departments (LHD).
- Places of worship can reopen by maintaining six feet of separation between household units. Passing items is not allowed. No collection plates?? More instructions to come.
These LHDs will have further relaxed measures on May 4: Douglas County, Sarpy /Cass, East Central, Four Corners, Loup Basin, North Central, Northeast Nebraska, Panhandle, Southeast, and Southwest Public Health Districts.
- Beauty shops, nail salons, barbershops, massage therapy services, and tattoo parlors may open. Workers and patrons must wear masks.
- Restaurants may serve dine-in customers by limiting seating to 50% of capacity. Parties must be seated six feet apart, and six people max per party.
- Childcare facilities can have up to 15 kids per room/space.
LB187 SUPPORT (Hilkeman)
- Adds two new definitions to an eligible sports arena facility to the Sports Arena Facility Financing Assistance Act.
- Any sports complex which includes concession areas, parking facilities and onsite administrative offices connected with operating the sports complex.
- A multipurpose field meaning a rectangular field of grass or synthetic turf which is primarily used for competitive field sports, that may include soccer, football, flag football, lacrosse or rugby.
- The bill repeals the occupancy requirement to receive a turn back of sales tax and replaces occupancy with project completion date.
LB1084 (Kolterman) MONITOR
- The Nebraska Transformational Project Act would provide $300 million in state funding to the University of Nebraska Medical Center for their NExT Project.
- NExT Project has two components: a state of the art academic medical center facility and a federal all-hazard disaster response military and civilian partnership.
- UNMC must show an economic impact to Nebraska of at least $2.7 billion during the planning and construction period and at least $4.9 billion over ten years.
FAILED TO ADVANCE
LB974 MONITOR (Linehan) REVENUE COMMITTEE PRIORITY BILL
- This is a complex property tax and school funding bill. As amended by AM2433, the bill would reduce property taxes as a major source of funding for K-12 education.
- Real property would be valued at 95% of actual value for tax year 2020.
- In tax year 2021, real property would be valued at 91%of actual value.
- In tax year 2022, and thereafter, real property would be valued at 86% of actual value.