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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

Monday, March 27, 2006

Nebraska Unicameral Update

LEGISLATIVE UPDATE - Nebraska Unicameral
MARCH 27, 2006

Budget Bill Heads to Final Approval

On March 23, the Legislature gave second-round approval to LB 1060, the main budget bill, by a 36-0 vote. The Final Round vote will likely take place this week.

During Select File debate, the Legislature voted to delete $500,000 sought by the Governor and recommended by the Appropriations Committee for a study of the state’s child welfare system. The amendment to delete this funding was offered by Sen. Howard and approved by a 25-11 vote. The amendments’ winning argument centered on the existence of previous studies of the child welfare system containing recommendations that have not been enacted or implemented (including some in legislation killed during this session).

The Legislature also voted to delete provisions approved during first-round debate concerning funding for women’s health care services. These were the provisions offered by Sen. Foley that became mired in abortion politics. The Legislature voted 26-5 on Select File to reverse course, with several Senators changing their votes. Sen. Pederson, Appropriations Committee chair, stated that the Health and Human Services Committee will conduct an interim study of the issue.

Finally, the Legislature approved adding $428,000 in state funds for multiagency drug task forces across the state to replace funding cut at the federal level.

Tax Bill Sailing Along

On March 22, the Legislature voted 28-1 to send LB 968 – the Revenue Committee’s tax cut package – to Select File.

Most of the General File debate dealt with whether the package is sustainable and whether it would leave the state’s reserve fund at risk. Sen. Beutler argued that the package was too large and would leave the state only $19 million above the legally mandated reserve at the end of fiscal year 2006-07 and the state budget over $194 million out of balance in fiscal year 2008-09. Sen. Landis, chair of the Revenue Committee, argued that the package was meant to appeal to a broad range of taxpayers and that the budget could be adjusted to fit the tax cuts if the Legislature considered it a spending priority.

Sen. Landis offered an amendment to appropriate an additional $5 million in each of the next two years to the Ethanol Production Incentive Cash Fund (EPIC). There is a projected shortfall of up to nearly $93 million by FY 2011-12 in the EPIC fund. Sen. Chambers offered an amendment that would have eliminated the additional EPIC funding, claiming that ethanol subsidies should be unnecessary and that the ethanol industry should depend on the marketplace. Sen. Chambers’ amendment failed on a 1-28 vote, and Sen. Landis’ amendment was adopted 32-1 (Sen. Landis’ amendment also would permit the sales tax exemption on construction labor – one of the largest portions of the tax cut package – to begin in July rather than October).

Select File debate of LB 968 will likely commence this week.

Clock Ticking … Big Issues Remain

In a sure sign that the Legislature is nearing the end of the session, evening sessions began last week with more scheduled this week.

Though the budget and tax cut proposals are nearing completion, some major items that were on the Legislature’s agenda in January have yet to see debate; with 13 days remaining in the session, time grows short for the consideration of some. The dispute between the Omaha and suburban school districts has yet to find a consensus resolution, and efforts failed last week to advance a proposal out of the Education Committee. On March 24, a special committee voted to recommend impeachment of University of Nebraska Regent David Hergert. The recommendation now goes to the Executive Board of the Legislature, a majority of whom are already on record as supporting impeachment. If the Executive Board approves drawing up articles of impeachment, the issue would then be sent to the entire Legislature for consideration. This issue has the potential to use much of the rest of the session’s days.

Legislative Lingo

Throughout the course of these updates, we will be using certain terms that describe where a bill is in the legislative process. Here is a brief guide to those terms and some basic legislative procedure:

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.

As bills are killed in committee or become law through floor stages, they will be deleted from the Legislative Update.

Bills Update

As in the past, we will divide into categories the bills we are working on or tracking. 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.

Based on further analysis and Priority Bill designations, this week we’ve added a few bills to our list.


LB 132 (Cunningham) –This bill modifies the Nebraska Pasteurized Milk Law. The bill sits on General File. Support
LB 346P (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
LB 834 (Kremer) – Would preempt any local government action to regulate the registration, labeling or sale of seed based on the “type, nature or genetic makeup.” The bill awaits action on General File. Oppose
LB 916 (Kremer) – Would implement the state Competitive Livestock Markets Act (passed by the Legislature in 1995) in the event the federal mandatory price reporting law is not re-authorized by Congress. The bill awaits action on General File. Support.
LB 990P (Wehrbein and others) – Would allow tax credits for livestock modernization projects under the Nebraska Advantage Rural Development Act. On March 22, the bill was advanced to Select File on a 41-0 vote. Sen. Kremer has proposed amending LB 346 (above) into the bill. The bill awaits action on Select File.
LB 1004 (Hudkins) – Would allow for promotion of Nebraska-made wine and liquor by allowing holders of farm winery licenses to obtain a special license to sell or consume alcohol. The bill awaits action on General File.
LB 1109 (Schrock) – Would modify rules for the rejection, suspension or revocation of livestock waste permits. The bill awaits action on General File.
LB 1195 (Schrock and others) – Would require counties to allow permits or variances to existing livestock facilities to construct or modify livestock waste facilities if the purpose of the permit or variance is to comply with state or federal regulations. The bill awaits action on General File (though it is unlikely to receive further attention since a similar provision was amended into LB 975, which was signed into law).


Note: Several mentions are made below to LB 126 – a reminder this was the bill passed by the Legislature, vetoed by the Governor and overridden by the Legislature in 2005 that requires all Class I (elementary-only) school districts to assimilate with a K-12 district. A citizen’s petition seeking the repeal of LB 126 will be on the November 2006 General Election ballot.

LB 129P (Education Committee) – An overhaul of the formula for state aid to schools. The bill is awaiting action in the Education Committee.
LB 839 (Hudkins) – Would order the State Committee for the Reorganization of School Districts to issue orders reestablishing Class I and Class VI (high school-only) districts if 2005’s LB 126 is repealed in November. The bill awaits action by the Education Committee. Support
LB 1050 (Wehrbein) – Would establish a study committee on the costs and benefits of countywide school districts. The bill awaits action by the Education Committee.
LB 1119 (Heidemann and others) – Would delay all provisions of LB 126 until 2007. The bill awaits action by the Education Committee. Support
LR 253CA (Hudkins and Fischer) – A proposed constitutional amendment that would require a vote of the people in affected districts on school mergers, dissolutions or affiliations. This is similar to a petition proposed by a group of Class I supporters for which signatures are being sought. The bill awaits action by the Education Committee. Support


LB 775 (Wehrbein) – Would reduce the sales tax rate to 5% after October 1, 2006 (from 5.5%). The bill awaits action by the Revenue Committee.
LB 849 (Redfield and others) – This is the Governor’s income tax reduction proposal. The bill awaits action by the Revenue Committee.
LB 896 (Preister) – Would establish a renewable energy tax credit against the income tax of the producer of electricity by renewable means. The bill awaits action on General File.
LB 968P (Redfield) – This is now the Revenue Committee’s tax relief proposal. The bill awaits action on Select File.
LB 1006P (Bourne and others) – The Governor’s school property tax levy proposal. The bill awaits action by the Revenue Committee (though a similar provision is included in LB 968).
LB 1239 (Raikes) – An income tax “simplification” plan. Would collapse income tax brackets into two rather than four – above and below $75,000 for estates and trusts and single and married filing separate taxpayers, and above and below $150,000 for joint and head-of-household taxpayers. The bill awaits action by the Revenue Committee.


LB 188P (Beutler) – Modifications to the Nebraska Campaign Finance Limitation Act. On March 23, the bill was advanced to Final Reading on a 33-2 vote (Senators Erdman and Smith voting ‘no”). The bill awaits action on Final Reading. Support
LB 554P (Beutler) – Would increase the state minimum wage. The bill awaits action on General File.
LB 1198 (Connealy) – Would authorize on-farm sales and use of biofuels by adding “microscale producer” to the definition of “producer” in existing motor fuels laws. The bill awaits action on General File. Support

post a question or comment here or contact John Crabtree,

Center for Rural Affairs
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