Fly on the Wall 2022: Tax package passes, criminal justice efforts fail, and more in action-packed week

This week was action-packed as a series of late nights continued. It’s somewhat unusual for the Speaker to schedule so many late nights in a row at this point in the session, and it’s showing in the burned-out demeanor of the body. This has been necessary, the Speaker has said, because so much remains on the legislature’s docket; but I’ll note that this backlog is due to the new normal of nearly every priority bill getting a cloture vote – e.g. the rise of the filibuster. When so many bills take 8+ hours of debate time, late nights become more necessary to get through essential bills.

Notable happenings this week: Senator Erdman’s consumption tax bill (LR 264CA) failed; the ARPA funding allocation package passed Final Reading (LB 1014); vetoes were overridden; a total abortion ban narrowly failed (LB 933); criminal justice reforms failed to achieve compromise (LB 920); and a massive tax cut package overcame opposition (LB 873).

Budget Vetoes Overridden, Intertwined with Tax Cuts

Governor Ricketts vetoed several budget line-items that would have cut about $170 million from the package. They included cuts to reimbursement rates for providers of social services- including developmental disability, senior care, and foster care providers; affordable housing for urban workforce; funding for a trail between Omaha and Lincoln; and funding for community corrections programming to help former inmates reintegrate post-release. 

The legislature quickly voted to override the vetoes, but it came at what some viewed as an unfair cost: the governor’s decision to veto funding for widely supported measures- like funding for developmental disability providers- put senators previously opposed to the tax cuts in LB 873 between a rock and a hard place, when they were more or less forced to vote for that package in exchange for the votes of LB 873 supporters to override the budget vetoes. Essentially, vetoed funding for provider rates, community corrections programming, and affordable housing were held hostage to force senators to vote for LB 873. 

LB 873, the contentious tax relief package that includes cuts to the top corporate and individual income tax rates, property tax relief funding, and Social Security income tax relief then made it to Final Reading after a continued filibuster. Opponents who said the legislature needed to do more to help middle-income Nebraskans attempted to do so with an amendment by Sen. DeBoer that would have provided more relief to Nebraskans in middle tax brackets. Proponents of LB 873 said the state couldn’t pay for the proposed additional middle-income tax cut, raising questions from some about what the legislature says the state does and does not have the money for. With an estimated $900 million price tag in the coming years, questions were raised about LB 873’s impact on the state’s revenue stream and ability to fund services in the future, when we’re likely to see less surplus cash coming in. 

Rental Assistance Veto Holds

The legislature failed to overcome the Governor’s veto of LB 1073, the emergency rental assistance bill, by one vote. It could have passed with one more vote from a missing member.

Those voting to override the veto criticized the message the body is sending about the state’s priorities and what we choose to make funding available for – such as prisons, recreational water projects, and tax cuts for the wealthy – while rejecting free aid to those in need. 

The US Treasury will still set aside $70 million in federal rental assistance that will go to the major metropolitan areas of Omaha and Lincoln. Critics of the Governor’s veto noted that his veto of the bill caused rural Nebraska to lose out on available funds and hurt greater Nebraska more than anything. Ricketts has often talked about the need to support rural Nebraska.

Corrections Reforms Fail

LB 920, the package of criminal justice reforms aimed at reducing prison overcrowding, failed to overcome opposition from opponents who expressed concerns about how its proposed sentencing and parole reforms might affect public safety. The package, informed by recommendations from an independent study of Nebraska’s overcrowded corrections system, was sunk after senators were divided over its proposed reduction of criminal penalties for nonviolent crimes and days of negotiations failed to yield compromise. Funding has been set aside for a new state penitentiary, which is likely to be approved next session. Opponents warned that without reforms, the state will continue to spend millions to build around its fast-growing incarcerated population. 

Abortion Ban Fails

LB 933, Sen. Albrecht’s total ban on abortion or “trigger ban”, which would have gone into effect if the Supreme Court overturns or weakens Roe v Wade this summer, failed to defeat a filibuster in a tense debate. It received 31 of the 33 votes needed for cloture to break the filibuster and advance, meaning it is dead for the year. I’d chalk this up to the fact that many senators who are typically moderate on this issue or even those who would typically support restrictions on abortion had a harder time supporting a flat-out ban on all abortions in Nebraska, with no exceptions provided for rape, incest, or pregnancies that put the mother’s health at risk. The bill’s punitive measures for health care providers, which would have caused abortion doctors to face felony charges, probably also contributed to its fate as the bill was seen as more extreme than previous measures that have sought to curtail abortion access. As I’ve mentioned, the possibility of a special session on this issue is still strong if the Supreme Court votes to weaken or overturn Roe v Wade this summer. 

The Week Ahead

LB 121, Sen. Hunt’s bill to lift the lifetime ban on food assistance (SNAP) for people with certain drug convictions, is back on Select File late Monday. Opponents have promised to filibuster it, saying that people who have committed these offenses are not deserving of government assistance. While the bill had the 25 votes necessary to advance from General File where it didn’t face a filibuster, it will face an uphill battle to achieve the 33 necessary to advance this round if it is indeed filibustered. 

We’re down to the wire in the legislature now, with four session days remaining as of Monday.  Really it’s three, considering the final 60th day is reserved for closing ceremonies. This week, Monday-Wednesday are session days, then the remainder of days are recess days until the final day on Wednesday the 20th. 

Until next week,

Your Capitol Fly on the Wall