February 21, 2014                                                                              Legislative Report Archive

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inheritRevenue Committee Hears Inheritance Tax Bills

Unfunded mandates and property tax increases took center stage at Thursday's Revenue Committee hearings on proposed legislation to reduce and eliminate inheritance taxes. County board members, NACO, and the OpenSky Policy Institute testified in opposition to both bills and county officials from across the state submitted written testimony.


LB812, introduced by Senator Tom Hansen, would repeal inheritance taxes beginning in 2015. In his opening statement, Senator Hansen outlined numerous functions counties perform on behalf of the state, including the new responsibilities for juvenile probation under last year's LB561. He noted that unfunded mandates need to be addressed before meaningful property tax relief can be achieved. Counties currently receive more than $50 million in inheritance taxes annually.


LB960, introduced by Senator Tom Carlson, would reduce the tax rates for Class II and Class III beneficiaries. Currently Class II beneficiaries -- aunts, uncles, nieces, and nephews -- pay 13 percent on property with a value in excess of $15,000. LB960 would decrease the rate to 7 percent. Class III beneficiaries, who are more distant relatives and unrelated persons, currently pay 18 percent on amounts in excess of $10,000. LB960 would decrease the rate to 9 percent. Although the impact would not be as dramatic as an outright repeal, the bill would result in an estimated $15-20 million reduction in inheritance tax collections.


As written, neither bill contains replacement revenue. Neither bill has been designated as a priority.


The committee also heard a bill introduced by Senator Russ Karpisek to restore state aid to counties, cities, and natural resources districts. LB1053 would distribute aid to counties based on a formula that was adopted in 2009 but not implemented because all state aid was eliminated. Each county would receive $30,000, with further distributions based upon a ratio of total county real and personal property valuation compared to total state valuation. Proponents, including counties, municipalities, and the OpenSky Policy Institute, reported the history of state aid and noted that the most effective aid is both predictable and sustainable.


The committee has not taken action on these bills. 


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pribillsPriority Bills are Focus of Second Half of Session

The designation of senator, committee and speaker priority bills was completed this week. Some of the priority bills of interest to counties are:


  • LB464 (Ashford priority) Change court jurisdiction over juveniles and indictment procedures
  • LB145 (Brasch priority) Change valuation of agricultural land and horticultural land
  • LB670 (McCoy priority) Change property tax valuations of agricultural land and horticultural land
  • LB887 (Campbell priority) Adopt the Wellness in Nebraska Act
  • LB565 (Nelson priority) Prohibit registering to vote and voting early on the same day
  • LB946 (Murante priority) Change provisions relating to elections
  • LB1087 (Pirsch priority) Create a homestead exemption for disabled veterans, widows, and widowers
  • LR423CA (Schumacher priority) Constitutional amendment to provide that residential real property may be classified separately for property taxation
  • LB999 (Seiler priority) Adopt the Criminal Justice Reentry and Data Act and create the Reentry Programming Board
  • LB661 (Government, Military and Veterans Affairs Committee priority) Provide for voter registration on the Secretary of State's website and use of Department of Motor Vehicle records
  • LB907 (Judiciary Committee priority) Provide for supervised release, reentry probation officers, create the Nebraska Center for Justice Research, and change presentence investigations and good time provisions
  • LB986 (Revenue Committee priority) Change homestead exemption income limitations
  • LB994 (Speaker priority) Change fees as prescribed for vital statistics


A complete listing of the priority bills can be found here.


Today marks the mid-point of the 2014 session. Committee hearings on bills will be completed next week and full days of debate will begin on March 4. Eighteen bills have passed and been signed by the governor.


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revrefRevenue Committee Considers Tax Reform Bills

On Wednesday, senators adjourned early to allow committees to meet in executive session to take action on bills that have been heard. The Revenue Committee took action on a handful of bills but work remains in formulating a tax reform package for this year. The committee will meet again in executive session on Friday afternoon after press time. 


The committee advanced three homestead exemption bills - LB850, LB986, and LB1087 - and two sales tax exemption bills. LB850 would provide a homestead exemption for persons with developmental disabilities. LB986 would change the income limits for eligibility for homestead exemptions. LB 986 is a Revenue Committee priority bill. LB1087 would provide a complete homestead exemption for disabled service-connected veterans. Senator Pete Pirsch has selected LB1087 as his priority bill.


Although the committee chose not to advance proposals to decrease ag land valuation from 75 percent to 65 percent, two bills on the issue, LB145 and LB670, have been prioritized. Instead, the committee will send a letter to the Appropriations Committee expressing support for increasing the Property Tax Credit Cash Fund. The Appropriations Committee heard three bills this week that would transfer additional funds to the program. The funding appears as a tax credit on property tax statements.


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snapSnapshots of County Issues

Bills Heard in Committee This Week

Government, Military and Veterans Affairs Committee

On Wednesday, the Government, Military and Veterans Affairs Committee heard a bill introduced by Senator Jerry Johnson at NACO's request to shorten the time frame for counties to take over the affairs of an inactive township. Existing law requires county boards to wait six months from the time that they are unable to fill two vacancies on a township board to hold a hearing to begin the process. LB980 would reduce the time frame to 45 days, which is the statutory time frame to fill other vacancies.


The committee also heard LB1013, which would expand county ordinance authority to include regulation of peddler, hawkers, and solicitors through a process of permits, fees, or both. The authority would extend only to areas not covered by municipal ordinances and testifiers mentioned the possibility of reciprocity with city permits.

At the same hearing, the committee took testimony on a bill that would allow unaffiliated voters to select a partisan ballot for all races in the primary election. LB773 was introduced because in some races, all candidates are of the same party and voters of other parties are not allowed to vote for the candidates in the primary election. Much of the discussion focused on policy issues.


On Thursday, the Government Committee heard LB1075, which would prohibit persons who are elected or appointed to the governing body of a governmental entity, including counties, from working for that entity for two years after leaving such position. Although there was speculation that the bill is aimed at the search for a new president for the University of Nebraska, Senator Burke Harr, the introducer, made it clear that the intent is to prevent appearance of collusion or impropriety when governmental entities hire a former member.


Revenue Committee

County assessors would divide irrigated cropland into subclasses to designate different types of irrigation under LB723. In addition, when determining what constitutes a comparable sale, assessors would have to consider whether the difference in well capacity or in water availability due to federal, state, or local regulatory actions or limited sources affects the sale of property. The bill did not receive a priority designation.


Transportation and Telecommunications Committee

The Transportation and Telecommunications Committee heard three bills on the One-Call Notification System on Tuesday. The system, formerly called the Diggers Hotline, creates a single point of communication between excavators and underground utilities regarding upcoming excavation projects. LB892 would provide a mechanism for injunctive relief for repeated violations and increase the maximum civil penalty for violations from $5,000 to $10,000. LB930 would require a representative of an underground natural gas pipeline to be present during excavations within 25 feet of a line. LB1045 would require all underground facilities to be buried at least 12 inches deep. Opponents testified that depth regulations are already in place for many underground facilities and it would be difficult to maintain the specified depth due to erosion, grading, and landscaping. The committee has not taken action on these bills.



Bills Advanced by Committees

General Affairs Committee

Counties that have been caring for an abandoned and neglected pioneer cemetery for five years would be allowed to transfer its management to a cemetery association or cemetery district by LB855, which was advanced by the General Affairs Committee. The county planning commission would have to review the proposed transfer and the county board would have to hold a public hearing on the issue.


Business and Labor Committee

Political subdivisions and the State of Nebraska would be prohibited from asking applicants for employment about criminal records until the employer has determined that the applicant meets minimum employment requirements. This is sometimes referred to as "ban the box" legislation and has been adopted in other states. LB932 was sent to the floor by the Business and Labor Committee. Among the other legislation advanced by the committee is a bill to increase the minimum wage, LB943.



Bills Advanced from General File

Senators advanced LB661, a bill to use motor vehicle records for online voter registration, from the first round of debate. The process, which would be in place on or before January 1, 2016, would match information in the computerized statewide voter registration list with the database of the Department of Motor Vehicles to verify the accuracy of information submitted on voter registration records. Electronic "motor voter" registrations would be electronically transmitted to county clerks and election commissioners. The bill advanced from the first round of debate with no dissenting votes.   



Bills Signed by the Governor

Governor Heineman signed two bills on February 18. LB588 defines veterans preference for purposes of hiring by the state or counties with a civil service system.   LB56 provides for automatic advancement in county primary elections if the number of candidates does not exceed the number of candidates to be nominated by a political party for that office. Because the bill carries an emergency clause, it will be effective for the primary elections in May.



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upcomgUpcoming NACO Events

NACO scholarship applications are due March 1. See details here.


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selSelected Committee Hearing Schedule

All bills introduced by the Legislature are assigned to one of the Legislature's committees for a public hearing. Hearings, which are held each afternoon, will conclude on February 28 and the Legislature will begin full days of debate.


Monday, February 24

Banking, Commerce and Insurance Committee

Room 1507, 1:30 p.m.

  • LB991 (Nordquist) Prohibit collection of interchange fees by payment card networks on certain taxes and fees


Business and Labor Committee

Room 2102, 1:30 p.m.

  • LB955 (Dubas) Adopt the Paid Family Medical Leave Act
  • LB1090 (Conrad) Adopt the Healthy Families and Workplaces Act
  • LB1073 (Lathrop) Require employers to e-verify immigration status of new employees


Transportation and Telecommunications Committee

Room 1113, 1:30 p.m.

  • LB925 (Coash) Provide for transfer of motor vehicle registration duties to county treasurers
  • LB954 (Dubas) Change rotating or flashing light provisions for certain vehicles


Tuesday, February 25

Education Committee

Room 1525, 1:30 p.m.

  • LB1060 (Lautenbaugh) Change from elected to appointed boards for educational service units


Transportation and Telecommunications Committee

Room 1113, 1:30 p.m.

  • LB667 (Krist) Provide an exception for motorcycles to certain vehicle light requirements
  • LB756 (Smith) Redefine bicycle and motor vehicle
  • LB847 (Hadley) Provide for fees for copies of motor vehicle accident reports
  • LB1071 (Lathrop) Provide additional rules of the road for bicycles and bikeways


Wednesday, February 26

Revenue Committee

Room 1524, 1:30 p.m.

  • LB979 (Harr) Change provisions relating to tax sales for delinquent property taxes
  • LB1043 (Nelson) Exempt certain deeds form the documentary stamp taxes


Judiciary Committee

Room 1113, 1:30 p.m.

  • LB811 (Schilz) Change provisions and penalties relating to the Uniform Controlled Substances Act
  • LB1027 (Karpisek) Change provisions relating to restoration of seized firearms as prescribed
  • LB1035 (McGill) Require reports regarding records of persons unable to purchase or possess handguns because of disqualification or disability
  • LB1110 (Christensen) Change concealed handgun permit renewal provisions for members of the armed forces and their spouses


Thursday, February 27

Judiciary Committee

Room 1113, 1:30 p.m.

  • LB1062 (Lautenbaugh) Require presentment of operator's license and proof of financial responsibility or evidence of insurance to a peace officer by a driver involved in an accident or impoundment of vehicle and authorize civil actions for certain expenses  


Natural Resources Committee

Room 1525, 1:30 p.m.

  • LB1112 (Christensen) Change provisions relating to an occupation tax on irrigated land


Revenue Committee

Room 1524, 1:30 p.m.

  • LB885 (Harr) Require the use of the income approach to value certain real property for tax purposes


Friday, February 28

Revenue Committee

Room 1524, 1:30 p.m.

  • LB1057 (Davis) Change the distribution of sales and use tax revenue and provide duties for the Department of Revenue
  • LR423CA (Nordquist) Constitutional amendment to provide that residential real property may be classified separately for property taxation


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