By Gov. Pete Ricketts
The 2022 Legislative Session will go down in history as one of the Nebraska Unicameral’s finest. In just 60 days, the Legislature passed record tax relief, made critical public safety enhancements, and invested in generational water resource projects. As if this wasn’t enough, Senators also allocated $1.04 billion of federal American Rescue Plan Act (ARPA) funding.
Here are some of the highlights of this historic session.
Tax Relief
The crowning achievement was tax relief. Heading into this session, we had delivered $4 billion in direct property tax relief over the past eight years. The tax package I signed into law, LB 873, delivers an additional $3.4 billion of tax relief to Nebraskans through tax year 2027. When fully implemented, LB 873 will provide 12 times the tax relief of any tax relief bill passed in any prior administration.
LB 873 is meaningful for Nebraska. Our seniors will see an accelerated phaseout of state taxation of social security income, which will now be fully exempt in tax year 2025. This keeps more money in our seniors’ pockets in the face of rising inflation and encourages them to stay in Nebraska to see their grandkids grow.
Nebraskans can now have certainty that property tax relief will continue. LB 873 makes permanent the property tax relief passed in 2020. This year, taxpayers received a 25.3% rebate from the State on what they paid into their local schools in property taxes. Additionally, the tax package creates a new rebate on property taxes paid to community colleges. The rebate will be $50 million for the 2022 tax year and grow to $195 million by tax year 2026.
Our hardworking middle-class families will receive much-needed tax relief through a reduction to their income tax rate. We will reduce the tax rate from 6.84% to 5.84% by the 2027 tax year. The legislation ensures our businesses will also have a tax rate of 5.84% by that same year. These changes will allow Nebraska to be more competitive with surrounding states.
Public Safety
This session, Senators embraced Nebraskans’ strong support of law enforcement and made strategic enhancements to public safety.
The Legislature followed my recommendation to allocate $47.7 million to add capacity to the Nebraska Law Enforcement Training Center in Grand Island. This investment will allow our new recruits to receive training that’s second-to-none. Senators also approved my proposal for $16.9 million to upgrade and expand our State Patrol Crime Lab. This will ensure the State Patrol has the capacity to process evidence efficiently and bring justice for victims of crime.
Additionally, we enacted legislation to strengthen our law enforcement workforce. We established reciprocity for out-of-state law enforcement officers to help them more quickly find jobs after moving to Nebraska. We also helped law enforcement agencies recruit and retain officers by paying for incentives for years of service. We provided tax relief on health care premiums for retired law enforcement age 60+ with 20+ years of service. And the State will provide a 100% tuition waiver to law enforcement studying at the University system, state colleges, or community colleges.
At a time when others are defunding the police, Nebraska is demonstrating our commitment to the women and men who put on the blue to protect our communities.
Water Resources
The Unicameral made additional investments for future generations of Nebraskans. This spring, I signed landmark legislation to protect and develop our water resources.
We enacted LB 1015 to authorize construction of the Perkins County Canal, which will protect our water flows stemming from the South Platte River. Nebraskans currently depend on this water for our drinking supply, agricultural irrigation, power generation, and the health of our natural environment. Through LB 1015, we will be able to get this vital project moving right away.
The Legislature also gave the green light on other water infrastructure projects through LB 1023. Senators approved four major projects put forward by the STAR WARS Committee: construction of a new marina at Lake McConaughy; a major marina expansion at Lewis and Clark Lake; construction of an event center and lodge at Niobrara State Park; and creation of a 3,600-acre reservoir between Lincoln and Omaha. These investments will develop Nebraska’s water resources to generate additional recreation and tourism opportunities.
Pandemic Recovery
Senators also passed a $1.04 billion ARPA budget to address the impacts of the coronavirus pandemic. Among other provisions: it invests $60 million to create more capacity at our community colleges; it allocates over $120 million for affordable housing; it devotes $100 million for shovel-ready projects delayed by the pandemic; it boosts healthcare by investing in behavioral health facilities and a rural health complex in Kearney; and it creates grants to expand meat processing capacity to benefit our ag producers and consumers.
Legislators also passed major legislation to revitalize urban areas adversely impacted by the coronavirus. LB 1024 creates economic recovery grants to support job training, small business growth, and land development in North Omaha, South Omaha, and other qualifying census tracts throughout the State.
On top of these ARPA investments, Senators prioritized growth in rural Nebraska by extending and expanding the Nebraska Rural Development Act. They also created tax credits to encourage fuel retailers to sell E15 and higher blends of ethanol.
In my end-of-session speech to the Legislature, I summed up all of these accomplishments in a single word: Wow! Any one of these would have been considered historic, but all four efforts passed in a short, 60-day session is truly remarkable.
If you have questions about legislation passed during the 2022 session, please email [email protected] or call 402-471-2244.