THE NEBRASKA

LEGISLATURE

The Unicameral System

Taxes & Spending

Hot Topics – What Would You Do?

THE NEBRASKA

UNICAMERAL

ONE OF A KIND

• 1934 Constitutional Amendment Passed creating a Non-

Partisan Unicameral

• The People serve as the Second House

• A Transparent process

• Hearings - Readings - Amendments

• Isolated from Political Party Influence

• allow lawmakers to base their actions on their own

convictions and the needs of their districts, rather than

according to party dictates

NEW FACES = NEW IDEAS?

• Nebraska was the last state legislature to adopt term limits. In 2000, 56 percent of voters passed a two-term four year limit on members of the legislature.

• In 2016, 11 Senators will end their terms due to term limits. There were 17 in 2014.

• 5 incumbent senators face major opposition, only 3 are running unopposed.

• Term Limits impact Nebraska differently than other states.

-Unicameral System - Nonpartisan

TAXES & SPENDING

how much does it cost to run

a state?

Where does the money come

from?

$$ TAXES $$

STATE REVENUE

Sales & Use

Taxes

Individual

Income Taxes

Corporate

Income Taxes

The Nebraska Economic

Forecast Advisory Board

Who? What?

THE THREE-LEGGED STOOL

• Property Taxes

• Agricultural Land V.

Residential &

Commercial

• Income Taxes

• Who pays?

• Sales & Use Taxes

• Do we need a broader

base?

TAX THE OTHER GUY!!!

“ I wont

agree to any

changes

unless I can

pay less in

property

taxes”

“We must do

something to

lower income

taxes and

bring more

businesses to

Nebraska”

“I am running

for the

Legislature

because we

need a

balanced

budget, and

to cut taxes.”

I PAY

MORE

THAN HE

DOES!

Really???

www.totaltaxinsights.org

WHAT IS THE SOLUTION?

• What have we heard?

• Property Taxes are too high!!!!! Well, maybe…

• We need to eliminate social security, Military

retirement, corporate and upper tier income

taxes. What about the middle class?

• We need to broaden the sales tax base and tax

more services. Well, except for the goods and

services I buy…

• Potential Property Tax proposals

• Change Agricultural Land value to an income

basis

• Reduce the percent of the assessed value taxed

to 60 or 65 percent (now 75%)

• Proposed Changes for Income Taxes

• Eliminate taxes on Social Security Income

• Reduce upper tier and corporate income taxes

• Revamp corporate incentive packages

• Proposed Changes for Sales and Use Taxes

• Eliminate some exemptions and tax more

services. “Broaden the Base!”

$$ SPENDING $$

•Biennial Budget – How

Much?

•Where does the money

go?

MAJOR BUDGET DRIVERS

Agency

Operations

In Fiscal Year

2015-2016

35.8%

• University

• HHSS

• Courts

• State Patrol

• Corrections

• 40+ State

Agencies

Aid to

Individuals

In Fiscal Year

2015-2016

31.7%

• Medicaid

• Child Welfare

• Public

Assistance

• Developmental

Disabilites

• Behavioral

Health Aid

Aid to Local

Government

In Fiscal Year

2015-2016

32%

• TEEOSA

• Special

Education

• Community

College Aid

• Homestead

Exemption

AGENCY OPERATIONS

• University of Nebraska and State Colleges - $1.25

billion

• Health & Human Services System - $513 million

• Correctional Services - $406 million

• Courts - $346 million

• State Patrol - $118 million

• Other Agencies - $467 million

STATE AID TO INDIVIDUALS

• Medicaid - $1.66 billion

• Child Welfare Aid - $302 million

• Developmental Disabilities Aid - $296 million

• Public Assistance - $220 million

• Behavioral Health Aid - $143 million

STATE AID TO LOCAL

GOVERNMENTS

• TEEOSA/State Aid to Schools - $1.9 billion

• Special Education - $441 million

• Community College Aid - $198 million

• Homestead Exemptions - $143 million

K-12 EDUCATION FUNDING

The Nebraska Constitution provides that :

“The Legislature shall provide for the free instruction in the common schools of this state of all persons between the ages of five and

twenty-one years.”

The Funding Formula:

NEEDS – RESOURCES = AID

Funding Comes from a mixture of

Income and Property Taxes, and other fees

“STATE AID” TO EDUCATION

• ALL schools receive “State Aid”

• Accounted for when looking at resources

that come from sources other than the

local school district.

• Not all schools receive “Equalization” Aid

• Formula Needs – Formula Resources =

Equalization Aid

OTHER ISSUES

• Corrections

• Death Penalty, Good Time, Overcrowding,

oversight

• Mental Health Care

• State or Private Oversight, Institutions,

children

• Medicaid

• To Expand or Not to Expand

Questions?