Post Tagged with: "Taxes"

Tax study facing complications; new wind for wind bills

Most people figured the death of Gov. Dave Heineman’s tax-reform proposals meant a little breathing room, until next year, on the matter.

Wrong-o.

Wednesday, the Legislature’s Executive Board had a bunch of concerns and suggested changes for the proposal tax study that rose from the ashes of the governor’s bills.

And then later in the day, the Legislature’s “defender of the downtrodden,” Omaha Sen. Ernie Chambers, pledged to fight and filibuster any tax reform ideas, thus forcing support of 33 of the Unicameral’s 49 lawmakers to get anything passed.

Leading the charge in the Exec Board discussion of the proposed tax study, Legislative Bill 613, was Omaha Sen. Steve Lathrop, a Democrat who is looking hard at running for the job now held by Heineman, a Republican.

Lathrop (as well as other senators on the committee) voiced concerns about including members of the Heineman Administration as ex-officio members of the tax study. Only state senators should be part of the study and not, for instance, the state tax administrator.

The governor, Lathrop said, has “again” left the Legislature with a mess

February 27, 2013 Read More

Tax reform debate begins on Gov. Heineman’s plan

After a bit of a delay, Gov. Dave Heineman’s bold tax reform plan was introduced on Tuesday morning.

But already some senators are questioning whether it’s too big of an issue for one legislative session.

He’s as serious as a judge about shifting the tax load and making Nebraska more attractive to business, but it’s an ambitious plan to be worked out amid the hubbub of the 90-day legislative session.

It’s a big, big gulp — a $2.4 billion tax swap from income to sales taxes. And only now are the business and farm groups most affected by this complicated plan beginning to assess what it will do to their tax bills.

The governor, in comments Monday to The World-Herald, said he’s convinced there’s enough time to do it in 2013.

January 22, 2013 Read More

Nebraska Legislature — races to watch on Tuesday

Twenty-five seats in the 49-seat Nebraska Legislature are up for grabs this year and Tuesday’s primary could tell us a lot about the mood of the voters.

Is there a “get rid of incumbents” streak out there, like there seems to be with the U.S. Congress?

Are voters comfortable with the Legislature’s controversial decisions to restore prenatal care for illegal immigrants and allow cities, with voter approval, to raise local sales taxes by a half cent?

And, can a couple of recent appointees of Gov. Dave Heineman withstand some stilff challenges in their districts?

A veteran lobbyist has said that appointed senators are like barn cats — you’d better not get too attached to them.

But will voters feel the same way about Sen. Dave Bloomfield in northeast Nebraska’s 17th District and Sen. Paul Lambert in the 2nd District in Cass County, just south of Omaha.

Bloomfield was a soft-spoken legislator, but will get a stiff challenge from a trio of candidates in his district, including Van Phillips, the former superintendent of schools in South Sioux City, the district’s largest city. Some think Bloomfield won’t get out of the primary.

Lambert was more talkative, weighing in on issues like the half-cent sales tax bill and another to maintain a tax-exemption for cities who finance buildings via non-profit leasing corporations. But the former Plattsmouth mayor has five opponents, including Robyn Larson, the mother of current Sen. Tyson Larson.

Other questions:

– can incumbent Ken Haar out-poll a well-financed pro-life opponent, Mike Hilgers, in District 21 in northern Lancaster County? The primary results will tell us a lot about what to expect in November.

– ditto with Omaha’s District 11, where incumbent Sen. Brenda Council will face off with former Sen. Ernie Chambers? Will Ernie have to do some campaigning to win? He said he did do campaign signs way back in the ’70s. But he won several re-election bids by just filing for the office.

– who emerges from a seven-candidate field in District 43 in Nebraska’s Sand Hills to replace Sen. Deb Fischer, who is term-limited but in a hot race for the GOP nomination for U.S. Senate. Could a non-rancher win that seat?

The U.S. Senate race is getting almost all of the primary chatter this year. And we’ll find out Tuesday if Fischer’s purported late surge is enough to overcome the early lead amassed by Atttorney General Jon Bruning and the solid base of State Treasurer Don Stenberg.

It would be an epic upset if Fischer pulls it out. It would confirm what some say about Bruning’s support among Republicans — that it’s like the Platte River, a mile wide and an inch deep.

May 14, 2012 Read More

One national media mention that Gov. Heineman won’t mention

Forgive us for we have slacked.

Since the 2012 session of the Nebraska Legislature ended, we’ve neglected to keep up our daily posts on our new Legislative blog, State Line, launched earlier this year.

Bascially, we were just worn out. So we took a couple of weeks off.

It was a brutal session, with lots of late nights and lots of emotional issues in the last month. The session ended on a heated note, with the Legislature overriding Gov. Dave Heineman on issues related to immigration and taxation.

The governor fired back, saying the session would be remembered for raising taxes on legal citizens, while extending benefits to illegal immigrants.

Pretty blunt stuff. I’m guessing that the gov isn’t getting many golf invitations from state senators, at least for a while.

But, if letters to the editor to the World Herald are any guide, it appears that Heineman has a point in saying that Nebraskans agree with his opinion.

But, in case you missed it, the New York Times doesn’t agree.

It weighed in on the emotional finale over providing taxpayer-funded benefits to the unborn children of illegal immigrants in an April 23 editorial entitled “The Undocumented and the Unborn.”

It noted how a strange coalition of groups — groups that oppose and support abortion, and those that advocate for immigrants and those that usually don’t — combined to push Legislative Bill 599 to approval. Both Nebraska Right to Life and Planned Parenthood, for instance, supported the bill.

The editorial concluded with a rap on the conservative Republican governor, who has staunchly opposed any taxpayer expenditures for illegal immigrants. (The bill got around that by declaring that any funds would be expended on the unborn child, which will become an American citizen automatically upon birth.)

”Advocates for women and the poor are not used to expecting much in Nebraska, one of the country’s most severely restrictive states for abortions and contraceptive services,” the editorial concluded. “If devoutly anti-abortion lawmakers can decree that immigrants’ children are precious people before they’re born, maybe at some point they can extend some of their compassion to children who have already entered the world, and to their parents who lack legal status.”

“But that is not what the governor wants. ‘Nebraska will become a magnet for illegal aliens,’ he warned darkly in his veto message, pointing out that none of his state’s six neighbors were following its lead on prenatal care. For us, that makes Nebraska a beacon on the prairie, for which the governor deserves no thanks.”

May 8, 2012 Read More

Nebraska Legislature and Dave Heineman: the final act of 2012

So the governor is planning to skip the traditional speech on the last day of the 2012 session.

That’s the kind of snub that gets the chatter going over at the State Capitol.

And maybe there’s something do it. Maybe the governor didn’t get a chuckle out of the skits at the annual Sine Die Party last week, especially the one that had him signing an executive order so that the purportedly Canadian peregrine falcons — illegal immigrants — couldn’t rear some “anchor babies” on a nesting box at the top of the Capitol.

Or maybe, as the governor said, he just doesn’t see a need for the speech.

Whatever it is, we’re headed for some emotional votes on Wednesday.

The stauchly anti-illegal immigration governor has stirred up his supporters, and he said they will not forget at the ballot box who supported the override of LB 599.

But supporters of the prenatal bill see it as upholding pro-life principles, even when the going gets tough. This, they said, is about the health and well-being of unborn babies who will become U.S. and Nebraska citizens. And, they add, prental care will save taxpayer dollars, since taxpayers have to pay to deliver and care for the babies, who are more likely to have birth defects and other maladies.

Don’t forget the override vote on LB 357, which would allow cities, with voter approval, to increase local sales taxes by a half cent. Backers see it as an essential tool for cities to raise money for infrastructure needs, like new streets and sewers, while Heineman said it’s purely about raising taxes.

As for the session-end speech, the Clerk’s office said governors haven’t skipped that ceremonial duty for at least the past 20 years. That includes some years when the governor got pretty roughed up by lawmakers in the way of veto overrrides.

Those season-end speeches are usually a bunch of verbal slaps on the back — even if the governor and lawmakers didn’t get along at all times during the session.

It is a ceremonial speech. Not much substance. But it does carry an important signal that seems to be lacking in politics these days — despite their differences, politicans can shake hands at the end of the day.

* * *

The governor might not be getting much love from state legislators, but he got some from the Washington Post recently.

A Post blogger included Heineman among the 10 most popular governors in the U.S. The Post wrote: “Heineman’s approval in a 2010 Rasmussen poll topped out at 77 percent (!), and he’s consistently been in the 60s and 70s in all public polling. (Heck, he beat beloved former University of Nebraska football coach Tom Osborne in a primary a few years back!) There was little doubt he could have walked into the U.S. Senate when Sen. Ben Nelson (D-Neb.) announced his retirement this year, but he opted not to. Like (Oklahoma Gov. Mary) Fallin, Heineman benefits greatly from representing a very conservative state.”

April 16, 2012 Read More

Nebraska Legislature: Forecast-ageddon on Friday

Friday’s the day everyone in the Legislature has been waiting for this year.

No, it’s not that big steak fry the senators all talk about. It’s the day the new tax revenue forecasts will be made by the Nebraska Economic Forecasting Advisory Board.

Feb. 24 — let’s call it “forecast-ageddon”!

The mostly obscure, nine-member board of business operators, bankers and economists meets two to three times a year to project how much sales, income and miscellaneous taxes (liquor taxes and such) the state can expect in the upcoming months.

It sets a benchmark on how much the state can spend. If forecasts are too low, it’s time to cut spending or raise taxes; if they’re too high, it’s time to plump up the cash reserves, give some back in the form of tax cuts or spend away on new programs or projects.

Recent forecasts have been on the gloomy side, leaving state legislators to cut spending and programs and hold off on tax cuts. But Gov. Heineman is among those thinking that better days are ahead and that the state has enough money now to afford a $130 million a year tax cut.

There are many doubters, and Friday’s forecast will shed some light, hopefully, on who’s right — those who think happy times are here again and the state can afford $95 million in new University of Nebraska construction projects, the governor’s tax cuts and a bunch of tax exemptions; or those who think we should hold tight and watch our purse strings.

A new group, the OpenSky Policy Institute, chimed in this week. It said that unless the new tax forecasts are amazingly good, the state ought to hold back on tax cuts. The state can’t afford them, the group said, and besides, states don’t cut taxes when they’re facing a budget gap in the future (projected at over $600 million in the next biennium).

Even conservative State Sen. Deb Fischer of Valentine, who is running for U.S. Senate, urged caution this week. She said she was flabbergasted at the number of spending proposals and tax exemptions pitched by her colleagues this year — which all cost money and take away revenue from current state priorities. She, too, said the state can’t afford it all.

Fischer, whose father used to be a state roads director, is concerned about one spending priority in particular: her bill last year that earmarks an additional $70 million-a-year in taxpayer money for new highways.

That’s a major chunk of change, but so would $130 million in tax cuts, or $19 million for the crippled child-welfare system, or $95 million for NU.

The Speaker of the Legislature, Sen. Mike Flood of Norfolk, has talked of lawmakers mixing together a “stew” of tax cuts, spending priorities and business incentives.

Friday, the projections of the Economic Forecasting board will launch the Legislature into high fiscal gear. The Appropriations Committee will start computing how much it can spend, the Revenue Committee will figure how many taxes can be cut, and Gov. Heineman will start working on what he can get out of the pot.

Friday will tell us if there’s meat on the economic recovery in Nebraska that we can all chew on, or more stew bones ahead.

February 23, 2012 Read More

Nebraska Legislature: What’s on tap for Wednesday

Gov. Heineman has introduced his tax-cut plans. Now, legislators will introduce their alternatives Wednesday before the Revenue Committee

Two Omaha senators, Heath Mello and Jeremy Nordquist, both Democrats, have been complaining that the Republican governor’s plan doesn’t do enough to help the middle-class, as Heineman says.

Mello’s Legislative Bill 977 is patterned after a proposal by fellow Democrat Tom White a few years back. It would grant property tax relief — which Mello and other senators say that draws many more complaints than the taxes targeted by the governor, which are individual and corporate income taxes, and county inheritance taxes.

Under LB 977, homeowners would receive between $150-$160.

Nordquist’s bill would exempt social security benefits from taxation, thus granting a break for retirees. Nebraska is one of the few states that tax such benefits.

Lexington Sen. John Wightman has also proposed an alternative to eliminating inheritance taxes, as the governor has proposed. Wightman’s LB 1102 would seek to gradually reduce the tax, thus allowing counties (which lost state aid last year) to better adjust to the loss of revenue.

Tuesday’s floor debate, at times, reminded one of consent calendar — no debate and almost immediate advancement of bills. But there’s a whopper at the bottom of Wednesday’s agenda — the bill to provide tax breaks for Project Edge, a $1.2 billion data center rumored to be looking at Kearney, Neb., as a potential location.

February 7, 2012 Read More

Nebraska Legislature and Gov. Heineman: a face-off in 2012?

”Never underestimate Dave Heineman.”

That was among the advice I got when I returned to covering state government four years ago. A former Army ranger, Heineman sticks to his message like Velcro, and forges ahead like he’s charging up Bunker Hill.

Just ask Tom Osborne if you should underestimate Heineman, whose life has been seeped in politics, either as an aide, a Republican Party executive, or an elected state official. He’s paddled these waters before.

But 2012 might be his sternest test.

Heineman wants to solidify his legacy as a tax-cutter this year with a new package of tax cuts, amounting to about $130 million a year. And he’s been campaigning like a Ranger, telling Nebraskans that the hard-working middle class deserve a tax cut, and special interests like the University of Nebraska (which wants $91 million for building projects) need to wait.

But the increased grumbling you hear among state senators makes you believe he’s going to have to settle for much less, and maybe very little. Some lawmakers are still upset about last fall’s special session on the Keystone XL pipeline. The governor, for weeks, said he wouldn’t support the session, then did a dramatic about-face and ordered senators back to Lincoln. He signed two bills into law, but most of the heavy lifting was done by state senators.

Now, they’re still buzzing at the State Capitol over a comment the governor supposedly made during a speech last week. People who were at the speech said his comments were taken out of context, but there are senators who swear he stated that he would not sign any bills until his tax-cut package is delivered to him. That would be a pretty hard line in the sand. It ruffles even more feathers at the “Hall of Hot Winds.”

And the tax cuts, to some, is more about symbolism and tax rankings than addressing complaints with taxes in Nebraska. Can anyone argue that inheritance taxes get more gripes than high property taxes?

There’s a long time left in the 60-day session (37 days to be exact) so it’s hard to say exactly might happen yet. But the governor is facing plenty of push back this year, and he may require every bit of his political skill to get his wishes in 2012.

February 6, 2012 Read More

Death tax proposal in trouble in Nebraska Legislature

Gov. Dave Heineman says it’s just good tax policy to eliminate the state’s last “death tax” — the inheritance taxes paid to Nebraska counties. It would also boost the state’s “business tax climate” ranking, as compiled by the conservative Tax Foundation, that now sits at less-than-stellar 30th.

But the rough reception repealing the inheritance tax got on Thursday leads to the conclusion that the idea is in for some major massaging, maybe a lowering or gradual end to the tax.

County officials howled loudly over losing the $40-48 million a year in taxes, describing it as essential revenue and a much better option than raising property taxes.

Several testifiers and lawyers, including Columbus Sen. Paul Schumacher, said that they’ve rarely heard complaints about inheritance taxes. Property taxes get the big complaints, and are paid by most Nebraskans (unlike inheritance taxes, which also impact a fair share of out-of-staters).

Schumacher drew some laughs when he challenged an assertion from the conservative Platte Institute that inheritance taxes were forcing Nebraskans to leave the state.

He said a grandmother who left $84,000 to each of her children would mean only a $440 inheritance tax bill per child (That’s because the levy on immediate relatives, such as children, is small, a 1 percent tax, and they get an exemption on the first $40,000).

“Is grandma going to move because her poor kids are going to pay $440?” he asked.

Ouch.

January 27, 2012 Read More

When to grant tax breaks, and when tax breaks break the bank

When covering government, they always say “follow the money.” And in the Nebraska Legislature, many of those money decisions occur in the Revenue Committee.

Consider this recent case before the committee: a home-grown, high-tech corporation, spawned on weekends and nights by two professors, has grown into a multi-million enterprise.

But they must pay $500,000-a-year in sales taxes on “biochips” the company uses to check out the genes in breeding cattle (which saves cattlemen time and money in picking the superior critters to breed).

The company, GeneSeek of Lincoln, says their annual economic impact is $42 million a year, and a quarter of their 45 employees are high-paid PhDs or masters-degree recipients. And they also pay $330,000 a year in royalties to the University of Nebraska-Lincoln.

But that nasty tax bill will impact where GeneSeek, which is now owned by a multi-national firm headquartered in Michigan, will expand.

This is exactly the kind of high-tech, high-paying, homegrown company Nebraska is trying to retain and grow by establishing Innovation Park on the doorstep of the UNL campus.

But a tax break for GeneSeek is no slam dunk, it appears.

They are one of a long line of companies, entities and industries seeking tax breaks from the state this year. Wind farms want another break, two data center projects want breaks, “procurement processing companies” want a break and so do folks who fix up historic properties. Even tanning salons want a break (to bake) this year.

At one point during a hearing Wednesday, Valentine Sen. Deb Fischer asked in frustration if all new companies looking at expanding at Innovation Park will need a tax break.

A university official said “no” but you get the picture.

It leaves legislators with an interesting dilemma — do you grant tax breaks to budding business, thus narrowing who pays the bills for state government, or do you, at some point, conclude that Nebraska is giving away too many goodies and someone has to pay the bills?

Stay tuned. The tax-break decisions will have a bearing on whether the state can grant tax breaks, fix the messed-up child welfare system and keep the budget in balance.

January 26, 2012 Read More

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