Senators debate, advance $9B budget

Luna Stephens and Katie Anderson

Nebraska News Service

Senators passed two state budget bills on July 31 including $55.2 million for damage from the 2019 floods, $10 million to the rural workforce housing investment fund and $3.7 million increase in developmental disability provider rates.

LB1008, presented by Speaker Sen. Jim Scheer of Norfolk at the request of Gov. Pete Ricketts, is the $9.4 billion mainline state budget bill. After final reading, bills are submitted to the governor. The governor must sign, veto or line item veto the budget within five calendar days, excluding Sunday.

Before the Nebraska Legislature’s session was suspended in March, the legislature passed an Appropriations Committee amendment to replace LB1008. The amendment included $55.2 million to address damage from the 2019 floods and provisions for 19 additional bills costing $15.2 million.

Prior to COVID-19 pandemic, the legislature expected to have $133.8 million leftover to fund bills pertaining to property tax relief and business incentives. After the Nebraska Economic Forecasting Advisory Board met on July 23, the board projected approximately $89 million will be available for the legislative floor to fund bills like property tax relief and business incentives.

The legislature may still debate property tax relief and business incentives. According to the Clerk of the Legislatures’ office the introducers of these bills need to prove to the speaker that they have 33 votes for the bill to be placed on the agenda for further debate. The session is scheduled through Aug. 13.

Wayne’s motion to LB1008

On July 31, Sen. Justin Wayne of Omaha introduced a motion to delay consideration of LB1008 until Aug. 11. The motion failed. Wayne wanted to wait to pass the budget bill until Congress recesses on Aug. 7. He said this would give the legislature time to discuss additional funds from the federal government.

“We shouldn’t pass a budget when we know within the next 14 days there could be an influx of dollars that would go right back to relief for COVID-19,” Wayne said.

Stinner amendment to LB1008

Sen. John Stinner of Gering, chairman of the Appropriations Committee, proposed an amendment on July 27 to LB1008 that was adopted 33-0. The amendment would allow any leftover coronavirus relief funds identified as of Nov. 15, 2020, to be reoffered through a grant process to meet unmet needs, if allowed by federal law.

Stinner said the funds received by the federal government in the coronavirus Aid, Relief and Economic Security, or CARES Act, have to be spent by Dec. 31, 2020, or returned to the federal government.

During debate on July 27, Sen. Tony Vargas of Omaha praised the Appropriations Committee for anticipating where to invest in the state’s health, housing and economic well-being of Nebraskans prior to COVID-19.

“This is the first time recently that we have invested in our state in a very proactive, pragmatic way, and I think that is critical as we move forward for this state,” Vargas said.

During debate on July 27, Wayne said he noticed a disconnect when senators create a bill they are passionate about and bring it onto the floor but are told there isn't money to fund it.

Wayne said he didn’t understand how $10 million was spent on rural workforce housing, but his bill that would support small businesses in Lincoln and Omaha in poverty areas was stuck in committee due to a $5 million fiscal note. He said he notices a difference between rural and urban funding within the state budget.

“I am just asking for the same courtesy when it comes to spending in our budget for poverty areas in the urban area,” Wayne said.

During debate on July 27, Sen. Curt Friesen of Henderson said he was concerned about the budget and Nebraska’s economic challenges ahead with COVID-19.

Cavanaugh amendment to LB1008

On July 28, Sen. Machaela Cavanaugh of Omaha introduced an amendment to LB1008, which failed to be adopted.

The amendment would have appropriated $216.3 million of the federal CARES Act to the Department of Health and Human Services for grants to nonprofits to help with pandemic relief and money designated for expanding capacity at childcare services. The money would also provide food and rent assistance and aid payments to families who have lost significant income due to the pandemic.

The amendment would also have appropriated $392 million in federal funding to the Department of Economic Development for programs including small business and livestock producers.

Stinner and Sen. Steve Lathrop of Omaha were concerned about allocating the money when it could be needed for emergency usage if a second wave of the pandemic happened.

“If we had a second surge, and we found ourselves having to build a hospital in an arena like they did in New York City, then we wish, we're gonna wish we didn't spend this money,” Lathrop said. “So that's sort of why I'm conflicted.”

Sen. Megan Hunt of Omaha said she supported the amendment and has seen the need for aid in her district, where businesses and restaurants continue to close.

“The economy isn't companies, the economy isn't buildings, the economy isn't expense accounts or the stock market,” Hunt said.“The economy is people and workers, and they're in a dire situation.”

Other budget adjustments

LB1009, introduced by Scheer at Ricketts’ request, is part of the governor’s budget adjustment recommendations. An amendment to the bill that was adopted would transfer $60 million from the governor’s emergency cash fund to the state’s cash reserve fund. On March 25, the governor signed a bill that provided $83.6 million to the governor's emergency cash fund to aid in the fight against COVID-19.