Blog for Rural America

The Center for Rural Affairs, a private, non-profit organization, is working to strengthen small businesses, family farms and ranches, and rural communities. Permission to reprint items from this web log is hereby granted, on the condition that clear credit is given to the original source of the material. If the blog provides information for a story, please let us know by sending an email to johnc@cfra.org.

Wednesday, February 23, 2005

Center for Rural Affairs February 21, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director, Rural Research and Analysis Program,
Center for Rural Affairs

Legislative Update

February 21, 2005

State Budget Process: The Legislature’s Turn

The Legislature’s Appropriations Committee has begun the Legislature’s part budget-making phase. Last week the Committee issued its preliminary budget that will be subject of public hearings over the next few weeks.

The major assumption in the Appropriation Committee’s budget is that the Economic Forecasting Board will increase the amount of revenue available to the state. We will all know if that assumption turns out to be a valid one when the Forecasting Board meets on February 25. Because of this assumption, the Committee’s preliminary budget is $64 million higher than the Governor’s budget released in January. Most of the increase is attributable to University faculty salary increases and increases in rates paid to health care providers contracting with the state.

The Committee budget also makes some adjustments in the Governor’s budget, many of them to encourage state agencies to justify positions contained in the Governor’s budget. An example is the inclusion in the Committee’s budget of the Main Street Program that was eliminated in the Governor’s budget.

Appropriation Committee Hearings

Appropriations Committee public hearings represent the next phase of the budget making process. Generally, the committee schedules several state agencies with common missions for hearings on the same day. These hearings are for agencies to comment on and justify their budget and for the public to provide input. The schedule for the next two weeks; all hearings begin at 1:30 pm.

Feb. 24 – Advocacy agencies and commissions (Commissions for the Blind, Status of Women, Mexican-Americans, Indian Affairs and Deaf; Equal Opportunity Commission; State Foster Care Review Board)

Feb. 25 – Taxation (Departments of Revenue and Property Assessment and Taxation and Tax Equalization and Review Commission)

Feb. 28 – Law and Order (State Courts, Board of Pardons and Parole, and State Patrol)

Mar. 1 – Health and Human Services


LB 126 Compromises

On February 15, Senators reached a compromise that advanced LB 126 to Select File. LB 126 is the bill that proposes “assimilation” of all Class I elementary-only schools into K-12 districts. It was the topic of a lengthy discussion in this space last week, and lengthy debate over fours days in the Legislature. In an effort to get moving on other matters and to avoid a do-or-die vote to end debate that neither side was confident in winning, Speaker Brashear brokered a compromise to vote now, talk and determine if the issues can be resolved.

In the agreement brokered by Speaker Brashear, opponents of LB 126 allowed a vote to advance LB 126 with the agreement that several issues would be the subject of negotiation and possible amendment prior to a Select File vote. According to Speaker Brashear, the issues that will be further discussed and subject to negotiation include:
Allowing only K-12 systems in Nebraska, a concept central to the purpose of LB 126;

Postponing implementation of LB 126 until residents of Class I districts have had the
opportunity to participate in the next K-12 school board election;

Accounting for existing cooperative agreements among Class I districts that provide services
under a common administrative structure; broadening the set of standards under which a
K-12 school board would allow Class I districts to continue operating;

Holding Class VI districts financially harmless from the changes made in LB 126.

The opponents of LB 126 made clear that they reserve their rights to continue debate on LB 126 and attempt to filibuster if these issues are not resolved to their liking.

With this agreement, LB 126 was advanced to Select File on a 33-8 vote (Senators Erdman, Fischer, Heidemann, Hudkins, Langemeier, Louden, McDonald and Smith voted “No”; six other rural Senators – most stated opponents to LB 126 – did not vote). Thirty-three votes is an important number – that is the number of votes needed to end debate on a bill, something LB 126 may need before all is said and done.

Sen. Thompson Resigns

Sen. Nancy Thompson of Papillion announced her resignation effective at the end of the session. Her term ran until January 2007. The Governor will appoint her replacement.

Bills Update

Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

NOTE: Once a bill is Indefinitely Postponed (killed) or signed into law, we will remove it from the Legislative Update list.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The bill sits on Select File. Support

LB 59 (Mines) – Would change the provision in the Microenterprise Development Act defining “microenterprise to allow for microenterprise loans up to $35,000 (from $25,000). On February 17 the bill was advanced to preparation for Final Reading. Support

LB 273 (Cunningham) – Would create the “Building Entrepreneurial Communities” program through a $1 million grant program for each of the next two years. The bill awaits action in the Government, Military and Veterans Affairs Committee. Support

Agriculture/Livestock

LB 71 (Stuhr) – Would re-authorize the Agricultural Opportunities and Value-Added Partnership Act (formerly the LB 1348 grant program). This program was terminated through budget cuts in 2001 and 2002. This bill would reauthorize the program through 2009. The bill sits on General File. Support

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill sits on General File. Support

LB 191 (Preister) – Would allow permit local requirements for environmental protection and financial assurance under the state’s environmental laws (including the Livestock Waste Management Act). A hearing is scheduled before the Natural Resources Committee on February 23.

LB 346 (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill sits on General File. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. Oppose.

LB 129 (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.

Taxes

LB 133 (Connealy) – Would provide a renewable energy sales tax credit, and would provide any generator of electricity from a renewable resource a credit against any sales and use tax. A hearing was held before the Revenue Committee on February 16.

LB 309 (Connealy) – Would establish the Small Business Rural Microenterprise Tax Credit. The bill would provide for $2 million worth of tax credits annually for small business (with five or fewer employees or beginning farmers/ranchers) in areas with declining population or low incomes or federal enterprise zones. The bill awaits action by the Revenue Committee. Support

LB 404 (Wehrbein) – Would create a tax credit for modernization and expansion of livestock facilities. The goal of the bill is to “attract and retain investment in Nebraska’s livestock industry.” The bill is pending in the Agriculture Committee.

Business Tax Incentives

In this year’s session there are numerous bills relating to amending Nebraska’s business tax incentive laws or creating new tax incentive programs. The primary bill is LB 646, the Advantage Nebraska Act, which would create a new, more generous tax incentive program to take the place of LB 775. The Fiscal Note for LB 646 estimated a revenue impact of the new incentive program of $61 million by 2011 (in addition to the ongoing LB 775 revenue impact). LB 646 awaits action in the Revenue Committee.

Other

LB 189 (Preister) – Would mandate an electricity portfolio from renewable sources of 1% in 2007 and increasing 1% every year until it reaches 10% in 2017. This would apply to all electricity produced in the state. The bill also creates a mechanism for the buying and selling of credits to meet the portfolio standard. The bill was Indefinitely Postponed on February 15 by the Natural Resources Committee.

LB 208 (Stuthman) – Provides for the appropriation of $1.75 million annually for the next two years to the state’s five federally qualified health clinics to provide services to the uninsured (the clinics are in Omaha, Lincoln and Scottsbluff). The bill is scheduled for hearing before the Appropriations Committee on March 1. Support

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

LB 655 (Beutler) – Would create the Task Force on Small Employers Health Plans that would review data and policy ideas concerning health care plans for small employers and recommend policy steps for the state on this issue. The bill is scheduled for hearing before the Banking, Commerce and Insurance Committee on February 22. Support.

Friday, February 18, 2005

Center for Rural Affairs Crunches the Budget Numbers

-- from the desk of Jon Bailey, Director, Rural Research and Analysis Program
Center for Rural Affairs

Rural Development and Rural Asset-Building Programs
President Bush’s FY 2006 Budget

ANALYSIS

> Less Rural Economic and Community Development

Rural America will lose more than one-third of its federal resources for rural economic and community development. The proposed new “Strengthening America’s Communities Initiative” would consolidate 18 economic and community development programs into one and provide one-third less funding (from $5.61 billion in FY05 for the 18 programs to $3.71 billion proposed in FY06 for the new initiative).

Extrapolating to the new initiative the 29.7 percent non-entitlement community share of the FY05 Community Development Block Grant (CDBG) program, rural America stands to lose at least one-third of its federal economic and community development resources in the new initiative through the elimination of the CDBG program and other rural development programs (and significant spending cuts in other community and economic development programs).

The result would be 1) a shifting of rural economic and community development costs to state and local resources, including an increased property tax burden in many places, and/or 2) rural communities left without the resources for vital projects modernizing their infrastructure, developing their economies for the 21st century, and enhancing their quality-of-life.

The ultimate impact of the President’s FY06 budget proposal is to make rural communities less attractive places to live with fewer economic opportunities and potentially higher taxes.

> Fewer Jobs and Businesses

The President’s budget proposes to eliminate programs that create jobs and businesses for rural America. The Small Business Administration programs that provide capital and technical assistance for microbusinesses are a major source of businesses and jobs in rural communities. Nearly 17 percent of all private, non-farm jobs in the United States come from microenterprise, and over one in five private, non-farm jobs are attributable to microenterprises in the most rural states in the nation.

In addition, several of the economic and community development programs being targeted for elimination or significant cuts create business and job opportunities in rural America (the Rural Business Enterprise Grant program, the Rural Business Opportunity Grant program, the Economic Development Administration, and the Resource Conservation and Development program, for example).
The President’s budget would result in fewer resources and fewer opportunities to create jobs and businesses in rural communities.

> Less Participatory Community Development in Rural America

One hallmark of the CDBG program was the requirement for public hearings and public input on community and economic development projects for which funding was sought. That may be lost under the proposed “Strengthening America’s Communities Initiative,” which would provide funding only to communities meeting specified criteria with no apparent requirement for public involvement. One such measure is unemployment, which would hurt many rural areas that have low unemployment rates but high rates of multiple jobholding, high poverty rates and low income.

Programs such as the Resource Conservation and Development program (with half its funding proposed for elimination) also directly involves communities and community members in community and economic development projects, with community members participating in governing boards and project committees.

The proposed budget also seeks to eliminate programs such as the Northern Great Plains Regional Authority, planning grants from the Economic Development Administration and the Rural Strategic Investment Program based on a community participation model that many are recommending as a democratic method for rural development on both the community and regional level.

> Less Asset-building in Rural Communities

The President’s budget provides for greater resources for several rural housing programs within USDA, particularly loan programs. However, what the budget gives with one hand, it takes with the other – it proposes to eliminate other rural housing programs and programs that provide resources for rural community-based organizations that develop and construct housing.

As discussed above, the budget also decreases opportunities for rural people – particularly low- and moderate-income rural residents – to own their own businesses and provide jobs. Asset-building – those investments in one’s life or family that will serve to build long-term wealth – is an important strategy for the future of rural America.

Assets like businesses and houses bond one to a place and help to build strong, more sustainable communities. Commitment to a place is what makes asset-building development an important and viable model for rural people and rural communities.

> Conclusion

The combination of public resources to modernize and enhance rural community infrastructure and quality-of-life and asset-building strategies can lead to rural community revitalization in the United States and full inclusion of rural Americans in the “ownership society.” Unfortunately, President Bush’s FY06 budget neither recognizes this possibility nor makes it a priority.


FISCAL YEAR 2006 BUDGET PROPOSAL

Below is an examination of the impact of President Bush’s Fiscal Year 2006 budget on funding of certain rural development programs and programs with a mission to build assets in rural communities and for rural people (housing and small business development primarily).

NOTE: All the following figures are in millions of dollars.


Value-Added Producer Grant Program
Authorized: $40.0
FY 05 Appropriation: $15.5
FY 06 Proposal: $15.5
Percent Change: (61.2)

USDA Rural Development (programs from various USDA agencies)

Program - Rural Community Advancement Business-Cooperative
FY05 Appropriation: $74.18
FY06 Proposed: $44.22
Pct. Change: (40.4)

Program - Rural Cooperative Dev. Grants
FY05 Appropriation: $24.0
FY06 Proposed: $21.0
Pct. Change: (12.5)

Program - Appropriate Technology Transfer for Rural Areas (ATTRA)
FY05 Appropriation: $2.0
FY06 Proposed: $0
Pct. Change: (100)

Program - Rural Eco. Dev. Grants
FY05 Appropriation: $10.0
FY06 Proposed: $10.0
Pct. Change: 0

Program - Rural Strategic Investment Program $100.0 $0 (100)
FY05 Appropriation: $100.0
FY06 Proposed: $0
Pct. Change: (100)

Program - Enterprise Zone/Enterprise Community/Rural Economic Area Partnership Program
(EZ/EC/REAP)
FY05 Appropriation: $22.16
FY06 Proposed: $13.37
Pct. Change: (39.7)

Program - Rural Community Development Initiative Grants (RCDI)
FY05 Appropriation:$6.3
FY06 Proposed: $0
Pct. Change: (100)

Program - Resource Conservation and Development Program (RC&D)
FY05 Appropriation: $51.64
FY06 Proposed: $25.6
Pct. Change: (50.4)

Program - Rural Bus. Enterprise Grant Program (RBEG)
FY05 Appropriation: $39.68
FY06 Proposed: $0*
Pct. Change: (100)

Program - Rural Bus. Opportunity Grant Program (RBOG)
FY05 Appropriation: $3.0
FY06 Proposed: $0*
Pct. Change: (100)

Program - Rural Enterprise Zone/Enterprise Community Round II
FY05 Appropriation: $12.50
FY06 Proposed: $0*
Pct. Change: (100)

Program - Intermediate Re-Lending Program (IRP)
FY05 Appropriation: $34.21
FY06 Proposed: $34.0
Pct. Change: (0.6)


Program - Northern Great Plains Regional Authority
FY05 Appropriation: $1.49
FY06 Proposed: $0
Pct. Change: (100)


SBA Microenterprise Development Programs

Program - Microloan Technical Assistance
FY05 Appropriation: $14.0
FY06 Proposed: $0
Pct. Change: (100)

Program - Microloan Program
FY05 Appropriation: $15.0
FY06 Proposed: $0
Pct. Change: (100)

Program - Program for Investment in Microentrepreneurs (PRIME)
FY05 Appropriation: $5.0
FY06 Proposed: $0
Pct. Change: (100)


Community Development and Housing Programs

Program - Community Development Block Grant (CDBG – 29.7% non-entitlement share)
FY05 Appropriation: $1,2332.559
FY06 Proposed: $0*
Pct. Change: (100)

Program - Rural Housing and Economic Development Program (HUD)
FY05 Appropriation: $24.0
FY06 Proposed: $0*
Pct. Change: (100)

Program - Economic Development Administration (Commerce)
FY05 Appropriation: $257.42
FY06 Proposed: $26.58 (salaries and expenses only)*
Pct. Change: (89.7)

Program - § 502 Single Family Loans (USDA)
FY05 Appropriation: $4,459.3
FY06 Proposed: $4,681.03
Pct. Change: 5.0

Program - § 504 Repair Loans (USDA)
FY05 Appropriation: $35.0
FY06 Proposed: $36.0
Pct. Change: 2.9

Program - § 515 Rental Loans (USDA)
FY05 Appropriation: $100.0
FY06 Proposed: $27.0
Pct. Change: (73)

Program - § 523 Land Development Loans (USDA)
FY05 Appropriation: $10.0
FY06 Proposed: $5.0
Pct. Change: (50)

Program - § 524 Site Loans (USDA)
FY05 Appropriation: $5.05
FY06 Proposed: $5.0
Pct. Change: (0.9)

Program - § 538 Multi-Family Loans (USDA)
FY05 Appropriation: $100.0
FY06 Proposed: $200.0
Pct. Change: 100

Program - Rental Assistance Grants (USDA)
FY05 Appropriation: $592.0
FY06 Proposed: $650.0
Pct. Change: 9.8

Program - § 523 Mutual and Self-Help Grants (USDA)
FY05 Appropriation: $34.0
FY06 Proposed: $34.0
Pct. Change: 0

Program - Rural Housing Assistance Grants (USDA)
FY05 Appropriation: $44.0
FY06 Proposed: $41.0
Pct. Change: (6.8)

Program - § 504 Repair Grants and Payments (USDA)
FY05 Appropriation: $31.0
FY06 Proposed: $30.0
Pct. Change: (3.2)


Community and Social Services

Program - Community Services Block Grants (HHS)
FY05 Appropriation: $631.0
FY06 Proposed: $0*
Pct. Change: 100

Program - Rural Community Facilities (HHS)
FY05 Appropriation: $7.0
FY06 Proposed: $0*
Pct. Change: 100

Program - Individual Development Accounts (HHS)
FY05 Appropriation: $25.0
FY06 Proposed: $25
Pct. Change: 0

* These are among 18 programs in the Departments of Housing and Urban Development, Commerce, Agriculture, Treasury and Health and Human Service being consolidated in the proposed Strengthening America’s Communities Initiative. In FY 2005, those 18 programs received combined funding of $5.61 billion; the FY 2006 budget proposes $3.71 billion for the Strengthening America’s Communities Initiative, a 33 percent reduction.

Thursday, February 17, 2005

Rural Action Alert - President's FY 2006 Budget Proposal

--from the desk of Chuck Hassebrook, Executive Director, Center for Rural Affairs

Dear Friends and Neighbors,

Congress is about to begin work on a new budget that could kill many community and small business development initiatives, slash soil and water conservation programs, and cut small and medium-size farms.

Or it could preserve funding for critical programs and instead save money through long needed reforms that cap subsidies to mega farms.

The outcome is in our hands. It is a critical time for grassroots citizens to make their voices heard. This is a moment when grassroots calls and action can have a huge impact.

Please take three critical steps to help build a better future for Rural America:

1. Call or write you representatives in Congress. Dial the capitol switchboard at (202) 224-3121 and ask for their offices. (If you need your Senators’ and Representative’s names or email addresses, click the following link and enter your zip code: http://www.congress.org/ )

Once transferred to the right office, leave a message with the receptionist. Tell them to protect funding for programs that offer a future to rural America – small business development, community development, conservation, and family farm programs. Tell them to cut spending instead by capping payments to mega farms. It's the most effective thing Congress could do to strenghten family farms and it saves money. (See below for background information.)

2. Email this post to everyone who should be interested and ask them to respond. You can email this post by clicking on the envelope icon just to the right of the "comments" link at the end of this post.

3. Please click on http://www.cfra.org/rural_action_network.htm to let us know you’ve responded and join our National Rural Action Network. It’s thousands of people nationwide speaking out for small towns, small business, and family farms.

We’ll keep you informed on how this turns out and send our free monthly Newsletter. We’ll alert you to future opportunities to make a difference on critical issues before Congress.

To learn more about us, please click on http://www.cfra.org/ . To make a donation for this work for Rural America, hit the "Donate Now" button in the top left corner of our web page. If you have questions, write us at info@cfra.org.

Thank you for your support!
Chuck HassebrookExecutive Director, Center for Rural Affairs


The President’s Budget Proposal

This year’s budget debate was launched by release of the President’s budget proposal. The President’s proposal shapes the debate, but it is just a proposal. Congress largely sets the budget.

The President’s budget proposal would:

>> Cut 1/3 of all federal funding for community development while merging 18 existing programs into one.

>> Eliminate the Small Business Administration Microloan Program. It’s the primary source of assistance for businesses with five or fewer employees, which create most rural jobs.

>> Eliminate rural business development grants from USDA.

>> End the Community Development Block Grant Program.

>> Cut half of funding for Resource Conservation and Development Districts, which play a critical role in rural development.

>> Eliminate over half of farm bill funding for the Value Added Producer Grant Program. It makes grants to producer controlled cooperatives and value added initiatives to capture a larger share of food system profit.

>> Cut over half of funding from the Conservation Security Program, which rewards farmers and ranchers for protecting the environment.

>> Impose an across the board five percent cut in farm program payments, which would hit hard on smaller farms.

On the positive side, the President proposes tightening the cap on payments to mega farms. We support that. The most effective way to strengthen family farms is to stop subsidizing mega farms to drive smaller farms out of business. And it saves money.

The President’s proposal includes tighter rules to prevent one farm from being divided into many farms on paper to avoid the limits. It would also impose a $250,000 cap on some or all payments. Details are sketchy.

The President’s proposal is only a first step. It is estimated to save only $1.2 billion over 10 years, less than one percent of commodity program spending. Aggressive payment limitation reform could save much more. It could take the place of the other cuts the President proposes – cuts that would hurt family farms, the environment, and rural communities.

Center for Rural Affairs
145 Main Street, PO Box 136
Lyons Nebraska
Phone: 402.687.2100
Email: info@cfra.org
Website: http://www.cfra.org/
Web Log: http://www.cfra.blogspot.com/

Tuesday, February 15, 2005

Center for Rural Affairs February 15, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director, Rural Research and Analysis Program
Center for Rural Affairs

February 15, 2005

LB 126: Class I Schools – Inefficient, Racist Enclaves or High-Performing, Necessary Institutions?

The first major legislative battle in the 2005 session is over LB 126, the bill that would require the “assimilation” of Nebraska’s Class I (elementary-only) schools into a K-12 school district. LB 126 has had three full days of debate and has been the only significant legislative action during those days. It appears that the debate will continue as there have been no votes on myriad substantive amendments and no move to cut off debate to advance the bill to the second round of debate.

The arguments in the debate are basically these:

Proponents of LB 126 (for assimilation of Class Is) – The state’s educational system will be more efficient if Class I schools are assimilated. Every child in a K-12 district will then have a coordinated curriculum. In addition, the state will save an estimated $12 million (according to an updated Fiscal Note provided the Senators during the first day of debate), though there is plenty of protection for necessary school buildings to remain open as attendance centers. Finally, and the most emotionally charged debating point, Class I schools (at least in the two examples used – Lexington and Schuyler) are essentially “white flight” opportunities for those parents who don’t want their kids attending school with an increasing Latino student body. Proponents point to extreme differences in per pupil spending between Class I schools and the K-12 district in these towns.

Opponents of LB 126 – The bill is nothing more than forced consolidation of rural schools, and the relatively large fiscal note is proof (how else to save that much money unless school buildings are to be closed and school staff terminated). The opponents point to the fact that Class I schools have been closing at their own pace for years, and local communities should be left to make the decision. The opponents also point to the performance of Class I schools and the recommendations of many educators for smaller schools. Finally, the opponents deny the racial implications – any student may option into a Class I school; the real issue is state aid and how it is distributed to all schools, particularly those in low-income communities; the local school board and community residents make spending decisions; other issues – particularly overcrowding and the failure of communities to pass bond issues are to blame; and why is the Legislature just picking on Class I schools when other, larger districts have similar (if not greater) issues – Omaha and its neighboring district of Westside is the prime example used in debate so far. Other issues of property taxation and the impact on rural communities are also being used as reasons against LB 126.

The Center for Rural Affairs opposes LB 126 because we believe it is ultimately about forced consolidation of rural schools and sets a bad precedent for future discussions of school structure – if the state (through the Legislature) can mandate that a certain type of school closes, then all other types and sizes of rural schools can be forced to close, merge, or consolidate. We believe it is a slippery slope when one class of school is terminated – where do the state mandates on school structure stop?

Obviously, there are some spending disparities between school systems and school buildings in many parts of the state. Those should be corrected through the state school aid formula and programs that would assist local communities in updating and modernizing school facilities. Assisting in the destruction of rural communities by closing their schools because of a few examples of funding disparities seems like the worst example of “throwing the baby out with the bath water.” The valid issues brought to the debate of LB 126 by its proponents can be resolved without inflicting wholesale destruction on rural Nebraska and its communities.

Action on LB 126 is likely to heat up this week – February 15 is “Rural Education Day” at the Legislature (with many Class I supporters present in Lincoln to watch and lobby) and there may be an attempt by LB 126’s supporters to end debate and advance the bill (which would require 33 votes).

Priority Bills

As we discussed last week, the new system of determining the line for floor debate gives more preference to Committee Priority Bills. Committee’s first choice Priority Bills will advance to the head of the line. In addition to LB 126 (the first choice Priority Bill of the Education Committee), the following bills are among those designated first choice committee Priority Bills:

LB 150, to establish a beef checkoff program (Agriculture Committee)

LB 242, concerning political accountability and disclosure provisions (Government, Military and Veterans Affairs Committee)

LB 162, changing hunting laws and fees (Natural Resources Committee)

LB 499, changing provisions related to the estate tax (Revenue Committee)

Legislative Lingo Update

A term you may hear or see used in this Update or other places is “Bracket.” This is a tactic used during debate to delay consideration of a bill – a Senator can move to “bracket” a bill to a certain date. This tactic can be used to essentially kill a bill – such as moving to “bracket” a bill to the last day of a session or until sometime in 2006. Or it can be used to delay consideration of a bill for few days to allow compromises to be worked on or to get to debate on other bills.

Bills Update

As in the past, we will divide the bills we are working on or tracking into categories. Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The primary purpose is to provide an incentive for contributions to local and community endowments and foundations, thus providing greater resources for rural economic and community development. The bill sits on Select File. Support

LB 59 (Mines) – Would change the provision in the Microenterprise Development Act defining “microenterprise to allow for microenterprise loans up to $35,000 (from $25,000). The bill sits on Select File. Support

LB 273 (Cunningham) – Would create the “Building Entrepreneurial Communities” program through a $1 million grant program for each of the next two years. Communities and neighborhoods in “chronic economic distress” (high unemployment, low income or population loss) would be eligible for grants up to $75,000 for projects that seek to build entrepreneurial communities. The bill awaits action in the Government, Military and Veterans Affairs Committee. Support

Agriculture/Livestock

LB 71 (Stuhr) – Would re-authorize the Agricultural Opportunities and Value-Added Partnership Act (formerly the LB 1348 grant program). This program was terminated through budget cuts in 2001 and 2002. This bill would reauthorize the program through 2009. The bill was advanced by the Agriculture Committee to General File on February 10. The Agriculture Committee amended the bill to provide more authority to the Department of Agriculture and expressed its intent that the program receive $1 million annually in funding. Support

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill was advanced by the Agriculture Committee to General File on February 10. Support

LB 191 (Preister) – Would permit local requirements for environmental protection and financial assurance under the state’s environmental laws (including the Livestock Waste Management Act). A hearing is scheduled before the Natural Resources Committee on February 23.

LB 346 (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. The bill was advanced by the Agriculture Committee to General File on February 10. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. See the discussion above. Oppose

LB 129 (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.

Taxes

LB 133 (Connealy) – Would provide a renewable energy sales tax credit, and would provide any generator of electricity from a renewable resource a credit against any sales and use tax. A hearing is scheduled before the Revenue Committee on February 16.

LB 309 (Connealy) – Would establish the Small Business Rural Microenterprise Tax Credit. The bill would provide for $2 million worth of tax credits annually for small business (with five or fewer employees or beginning farmers/ranchers) in areas with declining population or low incomes or federal enterprise zones. A hearing was held before the Revenue Committee on February 9; the Center for Rural Affairs provided testimony in support of the bill. Support

LB 404 (Wehrbein) – Would create a tax credit for modernization and expansion of livestock facilities. The goal of the bill is to “attract and retain investment in Nebraska’s livestock industry.” The bill is pending in the Agriculture Committee.

Business Tax Incentives

In this year’s session there are numerous bills relating to amending Nebraska’s business tax incentive laws or creating new tax incentive programs. The primary bill is LB 646, the Advantage Nebraska Act, which would create a new, more generous tax incentive program to take the place of LB 775. A hearing was held before the Revenue Committee on February 9. The Fiscal Note for LB 646 estimated a revenue impact of the new incentive program of $61 million by 2011 (in addition to the ongoing LB 775 revenue impact).

Other

LB 189 (Preister) – Would mandate an electricity portfolio from renewable sources of 1% in 2007 and increasing 1% every year until it reaches 10% in 2017. This would apply to all electricity produced in the state. The bill also creates a mechanism for the buying and selling of credits to meet the portfolio standard. The bill awaits action by the Natural Resources Committee.

LB 208 (Stuthman) – Provides for the appropriation of $1.75 million annually for the next two years to the state’s five federally qualified health clinics to provide services to the uninsured (the clinics are in Omaha, Lincoln and Scottsbluff). Support

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. The bill awaits action by the Health and Human Services Committee.

LB 655 (Beutler) – Would create the Task Force on Small Employers Health Plans that would review data and policy ideas concerning health care plans for small employers and recommend policy steps for the state on this issue. The bill is scheduled for hearing before the Banking, Commerce and Insurance Committee on February 22. Support.

Friday, February 11, 2005

The Benefits of Being "$pecial" - A Look at How Oregon Country Beef Makes Marketing Work for Them

-- from the desk of Russ Gifford, Director of Communications & Development, Center for Rural Affairs


The past few days has seen a flurry of activity from the agencies who keep an eye on Federal and State governments for those of us living and working in Rural America. They have called to our attention how the recent budget proposal from President Bush could make our continued existence very difficult. Even while we wait for the fall out to settle from this latest attack on our way of life, we still have to make a living. To keep our spirits up let's take a page or two from the Center's recent Fresh Promises report (http://www.cfra.org/freshpromises.htm) and see how Oregon Country Beef uses their special qualities as a marketing booster.


Oregon Country Beef, a cooperative of 40 ranches in central and eastern Oregon, has achieved the near-impossible over the past few years. While they are located in remote areas, far from any market, they successfully sell specialty beef products throughout the west coast and Pacific Northwest. Their story offers important insights into the successful specialty marketing of products, and is part of the Fresh Promises report created by the Center for Rural Affairs.

Holding on to the profits
The goal of Oregon Country Beef is to produce a sustainable lifestyle by producing a profitable product to meet customer demand for taste and integrity, created in a healthy environment. The key to any successful co-op though, is to hold on to the profits.

Traditionally, preparation and delivery of the final product to the retail chain are where profits can be “make or break”. These are areas generally reserved for specialists, who master the arcane regulations, and the special skills needed to process, ship and market beef.

Oregon Country Beef appears to have met these challenges head on. With 40 members and 61 stores carrying their product, along with restaurants and food service outlets, they produced $10 million dollars in sales last year.

What are the lessons we can learn from their success?
Pricing is realistic. The price is based on cost of production, necessary return on their investment, and a reasonable profit. They understand that cut-rate pricing eventually leads to a failure to be able to produce your goods.

Marketing is vital, and members are involved. Each member spends at least one weekend a year doing store visitations or in-store demonstrations. A team structure allows the group to share ideas and expertise, and appears to avoid the high cost of hiring outside marketing experts.

Most importantly, they did not try to create something new. They were already raising grass-fed beef free from growth hormones or antibiotics. They maintained that focus, believing it was a healthier choice of farming and ranching. Rather than trying to capitalize on something new, they created a brand based on quality and reliability.

Where to get more information
Oregon Country Beef is an example of how specialty beef marketing can be profitable. The Center has information for groups or individuals that are striving to take home a greater portion of the consumer's food dollar. For more information on the Value Added Program, talk to Mike Heavrin at the Center for Rural Affairs. mikeh@cfra.org.

Wednesday, February 09, 2005

Center for Rural Affairs February 9, 2005 Nebraska Legislative Update

-- from the desk of Jon Bailey, Director, Rural Research and Analysis Program
Center for Rural Affairs

Legislative Update - February 9, 2005

Priority Bills

Each Senator and each committee has the right to designate bills as Priority Bills. That is an important designation for any bill because, in general, Priority Bills receive preferential treatment in scheduling floor debate. With the number of bills introduced annually in the Unicameral and with a finite number of days in a legislative session, bills receiving Priority Bill status are ones not only more likely to receive time for debate, but are also the bills most likely to become law.

Speaker Brashear has instituted a new process for scheduling Priority Bills for debate. There are still generally three categories of Priority Bills – individual Senator Priority Bills, Committee Priority Bills, and Speaker Priority Bills. However, the Speaker has instituted a new hierarchy of Priority Bills for scheduling purposes. In the following order, Priority Bills will receive consideration for scheduling:

Committee “First Choice” Priority Bills
Senator Priority Bills
Committee “Second Choice” Priority Bills and Speaker Priority Bills as time allows

In addition, past practice allowed Senator Priority Bills to be scheduled on a “first come-first served” process – Senator Priority Bills were scheduled for debate according to when they were designated by Senators. Speaker Brashear is also changing that practice. The Speaker will use his discretion in deciding the scheduling order of Senator Priority Bills. The Speaker will use numerous criteria in making his decision – those include when the bill was advanced by the committee of jurisdiction, the level of opposition to the bill, the degree to “which differences have been addressed off the floor,” the level of substantive and technical issues addressed by the committee, and the “public policy implications” if the bill is not adopted in the session.

Priority Bills must be designated by the 45th day of a 90-day session, which is March 16 in the 2005 session.

Legislative Lingo Update

As committee hearings continue and committees begin making decisions on which bills to advance to the entire Legislature, below is a brief guide to legislative terms you will read in future Legislative Updates.

Committees have a number of options for each bill – send as introduced to the full Legislature for General File, send to General File with amendments, Indefinitely Postpone (or kill) the bill, or hold the bill over to the 2006 session .
Once a bill is sent to the full Legislature out of committee, it faces three possible stages – General File, Select File and Final Reading.
At the General File and Select File stages a bill can be amended; a bill cannot be amended at the Final Reading stage.

Bills Update

As in the past, we will divide the bills we are working on or tracking into categories. Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The primary purpose is to provide an incentive for contributions to local and community endowments and foundations, thus providing greater resources for rural economic and community development. During General File debate on February 8, an amendment was adopted that would reduce the amount of the credit to reduce the revenue impact of the bill from $4.6 million to $1.67 million. The bill was advanced to second round debate by a 32-9 vote. Support

LB 59 (Mines) – Would change the provision in the Microenterprise Development Act defining “microenterprise to allow for microenterprise loans up to $35,000 (from $25,000). On January 26 the bill was advanced from General File to Select File. Support

LB 273 (Cunningham) – Would create the “Building Entrepreneurial Communities” program through a $1 million grant program for each of the next two years. Communities and neighborhoods in “chronic economic distress” (high unemployment, low income or population loss) would be eligible for grants up to $75,000 for projects that seek to build entrepreneurial communities. A hearing was held before the Government, Military and Veterans Affairs Committee on February 4; the Center for Rural Affairs was among those providing testimony in support of the bill. Support

Agriculture/Livestock

LB 71 (Stuhr) – Would re-authorize the Agricultural Opportunities and Value-Added Partnership Act (formerly the LB 1348 grant program). This program was terminated through budget cuts in 2001 and 2002. This bill would reauthorize the program through 2009. The bill is pending in the Agriculture Committee. Support

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). A hearing before the Agriculture Committee was held on February 1; the Center for Rural Affairs was among those providing testimony in support of the bill. Support

LB 346 (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to increase utilization of the tax credit. A hearing before the Agriculture Committee was held on February 8; the Center for Rural Affairs was among those providing testimony in support of the bill. Support

Education/Schools

LB 126P (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. The bill would eliminate Class I school districts, and would likely end many of the actual school buildings. The bill sits on General File. The Education Committee has designated this as their “First Choice” Priority Bill – debate is scheduled to begin on February 9. Oppose – we believe this bill is forced consolidation of rural schools and sets a bad precedent for state mandated closures of rural schools.

LB 129 (Education Committee) – An overhaul of the formula for state aid to schools. The bill is pending in the Education Committee.

Taxes

LB 133 (Connealy) – Would provide a renewable energy sales tax credit, and would provide any generator of electricity from a renewable resource a credit against any sales and use tax. A hearing is scheduled before the Revenue Committee on February 16.

LB 309 (Connealy) – Would establish the Small Business Rural Microenterprise Tax Credit. The bill would provide for $2 million worth of tax credits annually for small business (with five or fewer employees or beginning farmers/ranchers) in areas with declining population or low incomes or federal enterprise zones. A hearing is scheduled before the Revenue Committee on February 9. Support

LB 404 (Wehrbein) – Would create a tax credit for modernization and expansion of livestock facilities. The goal of the bill is to “attract and retain investment in Nebraska’s livestock industry.” The bill is pending in the Agriculture Committee.

Business Tax Incentives

In this year’s session there are numerous bills relating to amending Nebraska’s business tax incentive laws or creating new tax incentive programs. The primary bill is LB 646, the Advantage Nebraska Act, which would create a new, more generous tax incentive program to take the place of LB 775. It is scheduled for hearing before the Revenue Committee on February 9. A host of other tax incentive bills are scheduled for hearing before the Revenue Committee on February 10 – LBs 482, 224, 313, 312, 696, 520, and 571.

Other

LB 189 (Preister) – Would mandate an electricity portfolio from renewable sources of 1% in 2007 and increasing 1% every year until it reaches 10% in 2017. This would apply to all electricity produced in the state. The bill also creates a mechanism for the buying and selling of credits to meet the portfolio standard. A hearing is scheduled before the Natural Resources Committee on February 10.

LB 208 (Stuthman) – Provides for the appropriation of $1.75 million annually for the next two years to the state’s five federally qualified health clinics to provide services to the uninsured (the clinics are in Omaha, Lincoln and Scottsbluff). Support

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. A hearing before the Health and Human Services Committee is scheduled for February 9.

LB 655 (Beutler) – Would create the Task Force on Small Employers Health Plans that would review data and policy ideas concerning health care plans for small employers and recommend policy steps for the state on this issue. The bill is scheduled for hearing before the Banking, Commerce and Insurance Committee on February 22. Support.

Monday, February 07, 2005

Center for Rural Affairs' response to President Bush's Fiscal Year 2006 proposed budget

February 7, 2005

President’s Proposed Budget Cuts at the Heart of Rural America


The Community Development Block Grant (CDBG) program, the Small Business Administration Microloan Program, and other rural development programs are on the chopping block in the budget proposed by President Bush today, raising questions about the future of rural America.

“The President’s budget would doom many rural Americans and many rural communities to permanent status as members of America’s underclass.” according to Jon Bailey, director of the Rural Research and Analysis Program at the Center for Rural Affairs, a non-profit rural advocacy group.

The new ‘Strengthening America’s Communities Initiative’ proposal actually weakens rural communities, says Bailey. "It would kill worthwhile programs and remove a third of the funding they provide for economic and community development.”

Center researchers contend the elimination of the CDBG and other programs will make it more difficult for rural communities to provide the necessary infrastructure needed for their future viability.

"The drastic cuts to programs that encourage the development of small businesses and rural housing will not allow low- and moderate-income rural Americans to become part of President Bush’s ‘Ownership Society, says "Bailey.

The President’s proposed Fiscal Year 2006 federal budget slashes funding for the programs that offer a future to Rural Economic Development.

Cuts Striking Rural America Hardest

A nearly 10% cut is proposed for The Department of Agriculture, and an 11.5% cut is proposed for Department of Housing and Urban Development. The USDA and HUD are two federal agencies with significant programs devoted to rural economic and community development. They are the targets of the largest reductions in discretionary spending.

Abandoning Rural Development

The President’s budget is also the beginning of the abandonment of the federal role in rural development. Cash-strapped local and state governments will have an even more difficult time meeting crucial needs for rural economic and community development. The diminishing of this endangered financial environment does not promote the future of rural places.

The following programs are among those being consolidated into the new “Strengthening America’s Communities Initiative” program in the Department of Commerce:
Rural Business Enterprise Grant Program (RBEG – USDA)
Rural Business Opportunity Grant Program (RBOG – USDA)
Enterprise Zone/Enterprise Community Program (USDA)
Community Development Block Grant Program (CDBG – HUD)
Rural Housing and Economic Development Program (HUD)

Limits on Farm Payment Program

The Center lauded the President’s proposal to tighten payments to mega farms, says Executive Director, Chuck Hassebrook. “The single most effective way to strengthen family farms is to stop subsidizing mega farms to drive smaller farms out of business.”

But the Center is calling on the president to go further. The proposal reduces the payment limit cap for individuals to $250,000 for commodity payments, including all types of marketing loan gains, while removing the three-entity-rule.

"Aggressive payment limitation reform could achieve 3-4 times the savings of the President’s proposal," said Hassebrook, and significantly reduce the need for the damaging cuts in USDA farm and rural programs.

Environmental Programs Ravaged

Bush would take over half the funding from the Conservation Security Program, which rewards environmentally sound farming and ranching and impose a 5% across the board cut in farm program payments, which will hit hard on small- and medium-size farmers.

Where is the Money Going?

The budget proposal lists an increase in discretionary spending of 18 billion dollars. The Defense budget is up 19 billion dollars. The Department of Commerce is being offered a nearly 50% increase in funding. And the legislative branch is to receive a 13.1% increase in its budget.

“The President’s Budget devastates rural communities," said Bailey.


Established in 1973, the Center for Rural Affairs is a private, non-profit organization working to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.

Wednesday, February 02, 2005

NY Times Bestselling Author Thomas Frank headlines the Center for Rural Affairs Annual Gathering Feb. 26, 2005 in Norfolk, NE.

(Lyons, NE) – Best selling author Thomas Frank will be the guest speaker at the annual gathering for the Center for Rural Affairs on Saturday, February 26. The Center is celebrating 32 years of advocacy for rural America at the day-long event to be held at the Lifelong Learning Center on the Northeast Community College campus in Norfolk, Nebraska.

Frank headlines a strong program of speakers and workshops on issues facing rural communities. The event will also include a small business fair featuring local microbusiness members of the Center’s Rural Enterprise Assistance Program (REAP). Registration starts at 9:30 am, and the program begins at 10:00a.m.

Topics for the multiple tracked “teach-in” sessions include small business strategies for rural regions, high value livestock markets and cooperatives, and a look at federal farm and rural policy including critical budget legislation. Development issues include wind power, agri-tourism, and a popular new model of community development. There are 17 different choices for participants to choose between.

“The annual gathering is a combination of a workshop, discussion group, and a party,” said Russ Gifford, Director of Communications for the Center. “Some topics highlight policies and practices that harm rural communities, and others demonstrate methods that individuals and communities can use to change the situation. Additional sessions will preview new opportunities.”

Chuck Hassebrook, executive director for the Center, will give the keynote address, “Why Rural Matters” over a lunch of locally grown food from family farms. Tickets for the lunch are $7.00 at the door.

Thomas Frank will speak at 4:00 p.m.

Called “the second coming of H.L. Mencken – but with better politics,” Thomas Frank brings Mark Twain’s “pen warmed up in hell” back to the examination of today’s politics. His best selling book “What’s the Matter with Kansas?” digs into the apparent contradiction of Midwesterners embracing a conservative agenda that is frequently at odds with their own self-interest. Frank’s conclusions are as searing as they are far-sighted.

Hassebrook will conclude the day with a look at “Where We Go from Here.”

“The goal is to empower people,” says Hassebrook. “Individuals, communities, and organizations can make a difference. Rural America is vital to the interests of all America, and we will not allow it to become an endangered species.”

For further information call 402 687-2100. For a complete schedule of events, visit our website at www.cfra.org/annualgathering.htm .

--//--

Established in 1973 the Center for Rural Affairs is a private, non-profit organization headquartered in Lyons, Nebraska. The Center works to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.

Tuesday, February 01, 2005

Center for Rural Affairs January 31, 2005 Nebraska Legislative Update

--from the desk of Jon M. Bailey,
Director Rural Research and Analysis Program
Center for Rural Affairs

New Governor Outlines Priorities

Governor Dave Heineman delivered his first State of the State Address on January 26, and outlined to the state the new administration’s priorities.

Education
Economic Vitality – The Governor noted the fact that Nebraska’s population is growing modestly while the state’s average age is increasing; that is not a demographic equation for long-term success. The Governor mentioned the need to concentrate more on value-added agriculture, small business development and entrepreneurship as ways to grow the state’s economy. The Governor made specific mention of the need to develop small business and entrepreneurship in rural Nebraska.

Governmental Efficiency – The Governor concentrated on technology as a way to bring a “customer friendly, customer responsive government” to Nebraska.

Public Safety – The Governor specifically pointed to funding 21 new state troopers and anti-methamphetamine legislation as his public safety agenda.

The overriding theme of the Governor’s speech was that the state needs to begin making “necessary changes to meet future challenges.”


Legislative Lingo Update

As committee hearings continue and committees begin making decisions on which bills to advance to the entire Legislature, below is a brief guide to legislative terms you will read in future Legislative Updates.

Committees have a number of options for each bill – send as introduced to the full Legislature for General File, send to General File with amendments, Indefinitely Postpone (or kill) the bill, or hold the bill over to the 2006 session .

Once a bill is sent to the full Legislature out of committee, it faces three possible stages – General File, Select File and Final Reading.

At the General File and Select File stages a bill can be amended; a bill cannot be amended at the Final Reading stage.

Priority Bills – Each Senator may designate a bill (not necessarily one he or she introduced) and each Committee may designate two bills “Priority Bills.” These bills received preferential scheduling treatment once the bill is advanced to the floor from committee.


Bills Update

As in the past, we will divide the bills we are working on or tracking into categories. Any bill designated a Priority Bill will also have a “P” attached to its number (for example, LB 123P). The chief sponsor of the bill is listed in parentheses.

The words Support or Oppose after a bill description indicate where the Center for Rural Affairs has taken a position on the bill. If neither word is indicated, the Center has not taken a position at this time.

Rural Development

LB 28 (Connealy) – The “Endow Nebraska Act.” The bill would provide a tax credit for a contribution to a qualified charitable organization. The primary purpose is to provide an incentive for contributions to local and community endowments and foundations, thus providing greater resources for rural economic and community development. The bill sits on General File. Support

LB 59 (Mines) – Would change the provision in the Microenterprise Development Act defining “microenterprise to allow for microenterprise loans up to $35,000 (from $25,000). On January 26 the bill was advanced from General File to Select File. Support

LB 273 (Cunningham) – Would create the “Building Entrepreneurial Communities” program through a $1 million grant program for each of the next two years. Communities and neighborhoods in “chronic economic distress” (high unemployment, low income or population loss) would be eligible for grants up to $75,000 for projects that seek to build entrepreneurial communities. The bill is scheduled for hearing before the Government, Military and Veterans Affairs Committee on February 4. Support


Agriculture/Livestock

LB 71 (Stuhr) – Would re-authorize the Agricultural Opportunities and Value-Added Partnership Act (formerly the LB 1348 grant program). This program was terminated through budget cuts in 2001 and 2002. This bill would reauthorize the program through 2009. The bill was heard before the Agriculture Committee on January 25. Support

LB 132 (Cunningham) – This bill modifies the Nebraska Pasteurized Milk Law by providing exemptions to small-scale dairies and processors to the often-expensive bottling and processing requirements, and by allowing dairies and farmers to advertise on-farm sales of non-pasteurized milk (currently, the sale of non-pasteurized milk cannot be advertised). The bill is scheduled for hearing before the Agriculture Committee on February 1. Support

LB 346 (Agriculture Committee) – Would modify several provisions of the Beginning Farmer Tax Credit Act all with the goal to make the tax credit more attractive and to increase usage. The bill is scheduled for hearing before the Agriculture Committee on February 8. Support


Education/Schools

LB 126 (Raikes) – Would mandate the “assimilation” of Class I schools (elementary-only schools) into K-12 school districts for the 2006-07 school year. The bill would eliminate Class I school districts, and would likely end many of the actual school buildings. The bill sits on General File and was passed over for debate on January 31 until a “later date.” Oppose – we believe this bill is forced consolidation of rural schools and sets a bad precedent for state mandated closures of rural schools.

LB 129 (Education Committee) – An overhaul of the formula for state aid to schools. A hearing on the bill was held before the Education Committee on January 25.


Taxes

LB 133 (Connealy) – Would provide a renewable energy sales tax credit, and would provide any generator of electricity from a renewable resource a credit against any sales and use tax. A hearing is scheduled before the Revenue Committee on February 16.

LB 309 (Connealy) – Would establish the Small Business Rural Microenterprise Tax Credit. The bill would provide for $2 million worth of tax credits annually for small business (with five or fewer employees or beginning farmers/ranchers) in areas with declining population or low incomes or federal enterprise zones. A hearing is scheduled before the Revenue Committee on February 9. Support

LB 404 (Wehrbein) – Would create a tax credit for modernization and expansion of livestock facilities. The goal of the bill is to “attract and retain investment in Nebraska’s livestock industry.” A hearing before the Agriculture Committee was held on January 21.


Business Tax Incentives

In this year’s session there are numerous bills relating to amending Nebraska’s business tax incentive laws or creating new tax incentive programs. The primary bill is LB 646, the Advantage Nebraska Act, which would create a new, more generous tax incentive program to take the place of LB 775. It is scheduled for hearing before the Revenue Committee on February 9. A host of other tax incentive bills are scheduled for hearing before the Revenue Committee on February 10 – LBs 482, 224, 313, 312, 696, 520, and 571.


Other

LB 189 (Preister) – Would mandate an electricity portfolio from renewable sources of 1% in 2007 and increasing 1% every year until it reaches 10% in 2017. This would apply to all electricity produced in the state. The bill also creates a mechanism for the buying and selling of credits to meet the portfolio standard.

LB 208 (Stuthman) – Provides for the appropriation of $1.75 million annually for the next two years to the state’s five federally qualified health clinics to provide services to the uninsured (the clinics are in Omaha, Lincoln and Scottsbluff). Support

LB 550 (Jensen) – Requires a plan to be submitted by December 1, 2005, for the financial support of community health centers and emergency medical services in the state. A hearing before the Health and Human Services Committee is scheduled for February 9.

LB 655 (Beutler) – Would create the Task Force on Small Employers Health Plans that would review data and policy ideas concerning health care plans for small employers and recommend policy steps for the state on this issue.
____________________________________________________________________

Center for Rural Affairs, 145 Main Street, Lyons, NE 68038.