State Legislative Report

The Columbus Area Chamber has begun another season of legislative advocacy and the Legislative Committee is hitting the ground running for a challenging year at the state level.

As usual, that work began with the Legislative Committee hosting our State Senator for the annual Legislative Kick-off Breakfast.  Senator Paul Schumacher gave a full house of attendees a great summary of the major issues to be debated in Lincoln…and as usual he have them the unvarnished truth.

The Senator said the property tax system worked exactly as designed over the past several years, raising tax revenues as land values went up.  But as farm income has gone back down to traditional levels in recent years, land values haven’t gone down in corresponding fashion so there is an imbalance created.

Senator Schumacher outlined three efforts coming in the realm of tax reform during this session.

*Governor Ricketts has proposed a package of changes to the state’s taxation system, but the Senator is not optimistic it will pass in the current form.  In fact, Senator Schumacher told us research is being done to determine if the idea of taxing out-of-state property owners differently than residents is constitutional, which could raise questions about the entire package.

*Senator Erdman has proposed a huge property tax reduction of more than $1-billion.  Senator Schumacher told the group Monday that nobody knows where that money would come from.  In fact, quite simply he said the plan “can’t work.”  As the Chamber leadership considers the massive spending cuts or increases in income and sales taxes that this plan would create, we would agree with his evaluation.

*Senator Briese is going to propose an increase in sales tax, but hadn’t introduced it as of that morning, so Senator Schumacher didn’t have details to share.  Schumacher was pessimistic about the bill’s chances because of how many opponents it will create as sales tax exemptions are eliminated.

As has been the case for the past few years, Senator Schumacher’s message regarding those proposals to the group  was that there is no “magic” and he doesn’t expect any substantial changes to come from this short session of the Unicameral.  He doesn’t believe the traditional projection of 5% state revenue growth is realistic, so there simply won’t be the resources to follow through with these plans.  He suggested about 75 bills of consequence will receive debate in this short session and likely none will include any revenue raisers because of the threat of a gubernatorial veto.

Of note, the Senator gave us a long-term “threat assessment” for three big areas that could someday be at-risk if Nebraska’s budget remains tight.  Those included roads funding such as the Build Nebraska Act, state colleges, and public power.  Obviously two out of three of those directly impact Columbus and our Chamber members so you can be sure we will be watching diligently!

If you would like a little good news, I can share that our Senator feels this session will be a bit more civilized than last year among the Unicameral’s members.

The breakfast begins the season for the Chamber’s Legislative Committee.  They will be actively engaged this session and would welcome input from Chamber members.  The Committee’s first conference call with the Nebraska Chamber is Thursday, January 25th at 2:00pm at the Chamber office.  All employees of any Chamber member are welcome.