The Room Where it Happens
Governor Ricketts signed the $9.3 billion adjusted state budget without so much as a single line-item veto. Hrumph! Who doesn’t enjoy a good veto override battle on the floor of the Legislature?
The Super Seven emerged from “the room where it happens” with a Grand Compromise. A package of economic development incentives, property tax relief, and a $300 million gift to the University of Nebraska Medical Center.
The compromise was immediately amended (AM 3316) by “Scheer” coincidence into LB 1107, a Speaker Scheer priority bill that just so happened to be available on General File. Floor debate began Wednesday, and LB 1107 advanced to Select File on Thursday (43-2-4). Select File debate is Tuesday morning.
- Property Tax Incentive Act is a refundable income tax credit based on the amount a taxpayer pays in property taxes to their school district during the previous year, not including taxes levied for bonded indebtedness or a levy override. In 2020, total credits will equal $125 million. For 2021 – 2023, credits will increase based on growth in the state’s net tax receipts and the cash reserve level. In 2024, the credit will cap at $375 million. Each year after that, total credits will be $375 million-plus the growth in total assessed value for all real property from the prior year to the current year. The Property Tax Credit Relief Fund remains funded annually at $275 million.
- ImagiNE Nebraska Act creates a new business tax incentive act. The Department of Economic Development director cannot approve applications that would include refunds or credits for a calendar year in which a “base authority” would be exceeded, without the governor’s approval. The base authority is $25 million in calendar years 2021 and 2022, $100 million for 2023 and 2024, and $150 million for 2025. In 2026, the director will adjust the base authority every three years to equal 3% of the state’s general fund net receipts. The unused base authority would carry forward to the following year, but base authority before 2026 could not exceed $400 million.
- Transformational Projects Act requires the state to provide $300 million toward a potential $1.6 billion academic hospital and all-hazards disaster response facility at the University of Nebraska Medical Center.
Mercifully, the Legislature adjourns sine die on Thursday. Thank you, COVID, for the longest short session in Nebraska history.
SOME PROVISIONS AMENDED INTO LB 1077
LB1084 (Kolterman) MONITOR – AMENDED INTO LB720 THE CHAMBER’S ECONOMIC DEVELOPMENT BILL
- 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.
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.
LB1107 SEE ABOVE
WILL DIE ON GENERAL FILE
LB187 (Hilkeman) SUPPORT
- 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.