Late nights began this last week at the Nebraska Legislature with senators debating into the evening. In fact, debate ran just short of midnight last Thursday as senators discussed LB367 (the tax package) and LB305, a bill that would direct sales and use tax collected on leased motor vehicles to the highway funds instead of the General Fund.

There were some changes to LB367, the tax cut package before it advanced to Final Reading. An amendment replaced previously proposed maximum school levy reduction from $1.05 to $1 and the reduction in the top state income tax bracket with a full repeal of the estate tax, an increase in the Earned Income Credit to 10 percent of the federal credit, and an increase to the proposed property tax credit. The amendment increases the property tax credit from the previous $150 million over two years to $220 million over the same period. Much of the extended debate revolved around an amendment to reduce the state sales tax from 5.5 to 5.0 percent, in addition to the other tax cuts already adopted, without a proposed offset to balance the budget. Those who supported the half-percent sales tax reduction forced members to end the debate with cloture votes.

Earlier last week, legislators moved the mainline budget bill more quickly than usual to the second round of debate.

Only one amendment was filed and eventually withdrawn after minimal debate, setting up a more lively debate for Select File on the Appropriations Committee's proposed two-year average, 4.5 percent budget increase.

Select File debate is scheduled for this week with several amendments filed to alter the proposed budget. I will do my best to maintain reasonable and sustainable growth as we revisit the budget for the second time.

Last Tuesday, the Legislature debated the Class I school district issue, LB658. It advanced to Final Reading on a 31-11-2 vote. Members had an extended debate on several varying ideas on how to proceed after the citizens of Nebraska repealed LB126 last fall at the ballot box.

Ultimately, the body stuck with most of the original plan that came out of committee. There would be several steps for a Class I district to be reorganized. An individual or group would create a plan that would be approved or denied by the State reorganization committee. If approved, a petition signed by 10 percent of the K-12 voters and 50 percent of the Class I voters would be required to get it on the next general ballot for the K-12 district to vote on it.

Finally, LB641, which would address the controversy over LB1024 that passed last year splitting up the Omaha Public School District, was advanced out of the Education Committee to General File, with a vote of 6-2. LB641 will most likely be up for debate some time this week.

As always, I appreciate hearing from you. Please contact me with any questions or concerns.