LINCOLN – President Foley, Speaker Hilgers, Members of the Legislature, Distinguished Guests, friends, my lovely wife and First Lady Susanne Shore, fellow Nebraskans – good morning!
Congratulations on the commencement of the Second Session of the 107th Nebraska Legislature. Welcome back to Lincoln. I look forward to working together to serve Nebraskans during what is certain to be a fast-paced, short session.
Eight years ago, I announced my run for Governor. I did so out of a love for my state and a desire to see her thrive. Through the years, the guiding light of my administration has remained the same: to Grow Nebraska.
And, despite weathering floods, fires, and a global pandemic, we have done just that.
In the face of unprecedented challenges, the State of the State is strong.
We’ve been living with COVID-19 for nearly two years. It’s changed the way we do business, educate, learn, and go about our daily lives. And in some tragic cases, it’s taken lives.
But, true to our collective character, we have kept moving forward. The development of vaccines, boosters, and new treatments has given us the opportunity to return to the pursuit of the Good Life.
Nebraskans don’t need to be mandated to do the right thing. They just do it. Without lockdowns or mandates, businesses were able to stay open. Parents were able to return to work, and their children were able to return to school. Where authoritarian states are struggling, we are thriving.
Politico’s State Pandemic Response Scorecard confirms this. An in-depth, independent analysis of all 50 states shows Nebraska has weathered this storm better than any other state.
We have the lowest unemployment rate in history – not only in the history of our state, but of our nation – at 1.8 percent.
Last November marked the third month in a row with over one million Nebraskans employed.
And, our manufacturing sector has come roaring back. In fact, today more Nebraskans are working in manufacturing than pre-pandemic.
Our economic successes are a testament to Nebraskans’ desire to work hard and earn. From teachers to truck drivers, mechanics to medical professionals, farmers to fast food workers, and every profession in between, our state’s women and men invest their time and effort to better their communities and support their families.
Last year, we supported their work and helped them grow Nebraska.
Thanks to the leadership of Chairwoman Linehan and the Revenue Committee, the 2021 session ushered in a historic level of tax relief—relief that will deliver $2 billion to Nebraskans over the next two years.
Many other great bills were passed into law thanks to your hard work.
Chairman Friesen, Speaker Hilgers, and the Telecommunications and Transportation Committee joined forces to secure passage of the Nebraska Rural Broadband Bridge Act. As a result, an additional thirty thousand Nebraska households will have access to high-speed broadband.
Senators Brewer and Gragert shepherded through legislation that fully exempts military retirement pay from state income tax. Reforms like this are how we will keep talented veterans in our state.
All this—and more—was accomplished while responsibly managing state spending and limiting expenditures to only 2.4 percent growth.
Behind the numbers, we’ve experienced intangible growth as well. Throughout Nebraska, our people’s grit, drive, and selflessness were on full display in 2021.
From North Omaha to North Platte, folks stepped up to solve problems in their communities.
In North Omaha, business and community leaders have been working to develop and revitalize Omaha’s historic North 24th Street. Through physical improvements such as providing high-speed fiber optic upgrades, and a comprehensive streetscape plan, the project’s work promises to bring businesses and customers back to the area.
In the home of famed Buffalo Bill Cody, North Platte ranchers felt the squeeze that comes with a lack of options for meat processing. Instead of accepting the status quo, David Briggs and others have launched Sustainable Beef, a beef processing plant that promises to bring nearly 900 jobs to the North Platte community and more than one billion dollars in annual revenue. More importantly, Nebraska’s ranchers will have more choice as they run their businesses.
Today, I’m joined by some of the people who are responsible for these incredible efforts: North Omaha’s Carmen Tapio, CEO of North End Teleservices; Pastor Ralph Lassiter, a leader with the North 24th Street Business Improvement District; and David Briggs, CEO of Sustainable Beef. Please join me in welcoming them.
Carmen, Pastor Ralph, and David: thank you for all you do to make our state better.
Other Nebraskans also continued to step up for one another. In 2021, over 200 of our men and women accepted the call to join the thin blue line that protects and serves our communities. They’ve earned that badge. They were trained, challenged, and tested – thanks, in part, to the work of instructors at our Law Enforcement Training Center in Grand Island.
We are joined here today by Law Enforcement Training Center Director Brenda Urbanek and Deputy Director Mark Stephenson. They work to make sure our men and women in blue are ready to respond to the unique needs of their communities. Brenda and Mark, thank you for all you do.
Our students continued to pursue personal development. We enter 2022 with more than 3,900 Nebraskans in registered apprenticeship programs throughout the state—including through our six great community colleges. That’s 3,900 more Nebraskans who are pursuing growth and contributing to our diverse, skilled workforce.
And, Nebraska continues to serve as a beacon for life. This includes the amazing aid our crisis pregnancy centers and other organizations provide to new mothers and their babies. It also includes the work our people do for some of Nebraska’s most vulnerable—born and unborn.
I specifically want to recognize all that Attorney General Doug Peterson does to combat human trafficking in our state. During his tenure, the State of Nebraska has prosecuted 76 sex trafficking crimes, holding accountable those who are exploiting the vulnerable and delivering justice for victims of this modern day form of slavery.
Thank you, AG Peterson, for your leadership to ensure that all Nebraskans can expect justice and equality under the law.
We must also recognize all the doctors, nurses, and health care professionals, whose stalwart selflessness and excellent care has helped us weather this pandemic. Please help me thank our healthcare heroes.
We’ve come a long way in one year. But there is still work to be done. Work that will help everyone in our state thrive.
This legislative session, there are four priorities we must accomplish to keep Nebraska strong for years to come.
It’s likely not a surprise to any of you that I am starting with tax relief. It’s been a staple of my budget recommendations every year. I was elected on the promise that I would bring tax relief to our state. It’s what the hardworking men and women of our state deserve. And, given our current financial situation, we must deliver.
Last year, we successfully passed a two-year budget that set priorities for this year and next.
While there is an opportunity to fine-tune this plan, I expect state agencies and our partners to live within our existing budget and limit any budget growth to under three percent.
By the end of fiscal year 2023, the State of Nebraska is anticipated to have an estimated $1.5 billion in its Cash Reserve Fund. Let me say that again: 1.5 billion dollars.
Folks, this is the people’s money, and we must support tax relief that puts this money back into the pockets of the people.
To start, we can build on last session’s reforms by accelerating the phase-in of Social Security tax exemptions to five years, instead of the current ten-year period. This would allow our older neighbors and friends to keep more of their hard-earned money.
We also need to ensure that we are building upon the historic amount of property tax relief provided during last session. This fiscal year – and next – $548 million in annual property tax relief will go back to our people through LB1107. And we must make sure it does not drop below this floor.
Finally, over the next five years, we must reduce the top individual tax rate by one percent – from 6.84 percent to 5.84 percent. For those who may try to brand this as a tax cut for the rich, I challenge you to ask Nebraskans earning $33,180 a year, or families earning $66,360 a year, if they feel rich. They make up the 418,900 Nebraskans in this tax bracket who deserve relief.
And we can offer that relief while aligning job creator rates to this new individual income tax rate.
It’s imperative that we also remember our core responsibility: to protect public safety. After all, people are our greatest resource. There are several opportunities this session to strengthen our commitment to keep Nebraskans safe.
Historic agreements were struck to provide substantial pay increases for our 24/7 public health and safety positions. This will help us attract and retain quality corrections teammates. We’ve already seen a fivefold increase in Department of Corrections applicants since this announcement was made.
I am also requesting $16.9 million to enhance our state crime lab, which analyzes forensic and physical criminal evidence to better secure justice for victims of crime.
And $47.7 million to go toward the expansion of our Law Enforcement Training Center in Grand Island.
Finally, we must fully fund the replacement of the Nebraska State Penitentiary. The existing penitentiary was built over one hundred and fifty years ago. Its walls are crumbling, and its infrastructure is aged beyond simple repair.
For those wishing to pursue criminal justice reform, this should be a no-brainer. A modern facility will give our inmates a better quality of life. Modernizing our State Penitentiary will allow us to offer enhanced services and programming to prepare these men for life after time served.
I am not asking anyone to choose between supporting a modern State Penitentiary and pursuing policies that aim to reduce crime and recidivism. These solutions are not at odds, and there is room for both as we work to strengthen Nebraska.
This year, we can also help secure our water resources for generations to come.
After our people, water is Nebraska’s greatest natural resource.
To secure Nebraska’s water supply, I am recommending $500 million to construct a canal and reservoir system from the South Platte River.
Access to this water enables our farmers and ranchers to produce. It protects quality drinking water. It keeps electric generating costs manageable, and it ensures Nebraska remains the best place in the world to live, work, and raise a family.
If we fail to secure our supply from the South Platte River, we could expect to lose 90 percent of the water that currently comes to us from Colorado. We must act to preserve, protect, manage, and steward our water supply for our future Nebraskans.
I am also requesting $200 million be allocated to the water projects presented by the STAR WARS Special Committee. These projects will also secure our access to water—and they provide the additional promise to grow the Good Life in tourism and recreation.
In addition, I am recommending: $5 million to support repairs on the Peru Levee; $60 million to restore and protect drinking water systems in rural areas, such as Cedar and Knox Counties; and $23 million in repairs to the Fort Laramie Gering canal tunnel.
This year, we also have the rare task of spending the $1.04 billion that Nebraska has been allocated through the American Rescue Plan Act. These ARPA funds can help our state grow into the future.
Today, I am releasing a second budget recommendation with proposals on how to spend this ARPA funding, and I look forward to the robust debate that will ensue as you work to determine where this money is best spent.
I cannot stress it enough: ARPA funds are one-time funds. They must be spent as such. Each one of us has a responsibility to guard against spending this money in a way that grows government expenses.
My proposal includes 29 qualifying initiatives that will better Nebraska.
It will deliver nearly $200 million for public health emergency response.
And, for areas that experienced negative economic impacts from COVID-19, I am requesting over $500 million. This includes assistance for economic development projects in North Omaha and funding for beef processing supply chain issues in North Platte.
It secures funding for parents of low-income children who have experienced learning loss during the pandemic, and it provides Nebraska’s community colleges dollars to enhance their workforce development programs.
It also funds behavioral health and nursing incentives to ensure continued access to excellent care throughout our state.
In addition, my ARPA budget proposal includes over $284 million to water and sewer projects. This includes partial funding for the Perkins County Canal and Reservoir construction, funding for the STAR WARS Special Committee proposals, and other key water projects I’ve mentioned today.
Putting money back into the pockets of hardworking Nebraskans. Protecting public safety. Securing access to our natural resources. And investing in one-time projects that will enhance our state. These are the ways we can keep Nebraska strong and growing in 2022.
I know that there will be tough debates. Long nights. And seemingly impossible time constraints.
But I also know that we get the job done when everyone rolls up their sleeves and works together.
Thank you for your service to the people of Nebraska. Our work in the coming days will require a spirit of collaboration and cooperation and for each of us to do our part to keep Nebraska strong.
I look forward to the challenge, opportunity, and honor of working with you.
Remember: Nebraska is what America is supposed to be.
God bless you all, and God bless the great State of Nebraska!