Economic Advisory Board increases state revenue forecast

The public hearing process is now complete. A hearing was held on every bill that was introduced before the committee with jurisdiction over the subject matter. The legislature began meeting in full-day sessions March 8. The following week, we will begin meeting into the evenings, in order to complete our work by April 20.

On Monday of this past week, senators focused on consent calendar bills. Consent calendar is a process to allow noncontroversial bills, without priority status, to be debated by the legislature. If three senators object to any of the bills listed on consent calendar, the bill is removed. Furthermore, amendments that are not purely technical in nature cannot be added to these bills. I had one bill on consent calendar that was given first-round approval, dealing with township libraries. If a county votes to discontinue a township form of government and the township has a library, LB 75 requires the county board to hold a hearing on what should happen to the library, in order to give residents the chance to voice their opinion.

On Tuesday and Wednesday, senators advanced 17 priority bills that weren’t controversial. Two of the bills I introduced were given initial approval. LB 780 makes common-sense changes in two programs administered by the Nebraska Department of Labor – child labor and Nebraska’s short-time compensation program. LB 864 expands Nebraska’s college savings plan, allowing 529 plans to be used for loan payments, reflecting changes made on the federal level.

The Nebraska Economic Forecasting Advisory Board met this past week and voted to increase projections for the current 2021/22 year and the 2022/23 fiscal year. The board decided to increase the forecast made in October of last year by $370 million for this year and by $405 million for next year. The increased revenue for the current fiscal year will be transferred to the Cash Reserve Fund, bringing its projected balance to $1.7 billion.

Much of the projected increase in revenue can be attributed to the large magnitude of federal dollars that have been distributed to Nebraska – to individuals, businesses, political subdivisions and the state. Nebraska will receive approximately $24 billion. This amount is equivalent to 22% of total state personal income.

The increased revenue projections led the governor to strongly push for two of his proposals to be funded – $230 million for a new state penitentiary and $500 million for the Perkins County Canal Project.

This is in addition to proposals pending at the second stage of debate to reduce the top rate of individual and corporate income tax, accelerate the elimination of the state income tax on Social Security benefits and continue to fund substantial local property tax relief.

The Appropriations Committee is finishing work on the budget.