LB 401 (1997)
May 13, 1997
CLERK: I have a quorum present, Madam President.
PRESIDENT ROBAK: Thank you, Mr. Clerk. We turn now to General File and LB 401. Excuse me, before we begin, items for the record.
CLERK: Madam President, may I indicate that I have amendments from Senator Chambers to be printed to LB 216. (See page 1932 of the Legislative Journal.)
PRESIDENT ROBAK: We turn now to General File and LB 401.
CLERK: (LB) 401, Madam President, a bill introduced originally by Senator Warner. (Read title.) The bill was introduced on January 15, referred to the Revenue Committee, advanced to General File. Committee amendments were presented on May 7. At that time, there were amendments offered by Senator Maurstad that were adopted. I now have a series of amendments pending to the committee amendments, Madam President.
PRESIDENT ROBAK: Senator Wickersham, would you like to remind the body where we are on the committee amendments.
SENATOR WICKERSHAM: Thank you, Mr. Pre ... Madam President. The committee amendments were amended in the floor debate 'Last week. We adopted an amendment by Senator Maurstad calling for a 5 1/2 percent rate reduction. That is perpetual and in addition to the personal exemption credit that is available currently for dependents, increasing that by $20 over each year of the next biennium. That amendment has been adopted. That supplanted the committee amendment. The committee amendment, as amended, has not yet been adopted. The bill, as originally introduced, called for a 5 1/2 percent reduction that would have been perpetual, as the 5 1/2 percent reduction in the rates across all brackets. The change that was implemented in the bill as introduced by Senator Maurstad's amendment was the introduction of an increase in the personal exemption credit for two years.
PRESIDENT ROBAK: Thank you, Senator Wickersham. Senator Robak announces that the following guests are visiting the Legislature. There are 18 fourth grade students here from St. Edward, Nebraska and seven adults with them. (Introduces
teachers.) They are all seated in the north balcony. Will you stand and be recognized please. Welcome to the Nebraska Legislature. Mr. Clerk, first amendment.
CLERK: First amendment, Madam President, Senator Robak has an amendment to the committee amendment. Senator, you had opened on this amendment, AM1727.
PRESIDENT ROBAK: The Chair recognizes Senator Robak.
SENATOR ROBAK: Thank you, Madam Speaker, members of the body. I would just like to state my amendment for what it is, and it is, federal income tax returns allow Social Security recipients to exempt part of their Social Security income depending on their total income. Some folks who receive a federal pension are taxed on the entire amount. These two scenarios affect the state income tax obligation because our state return is based on the federal adjusted gross income. And, obviously, we can't change federal law, so this amendment allows federal retirees living in the state of Nebraska to exempt part of their federal pension from state income tax using the same formula as Social Security... the same formula as Social Security recipients use for federal tax computation. That's just a reminder that the amendment that I had, when we had 401 up for debate before we were all ushered into the basement during that tornado fly-over. With that, I will be happy to withdraw, not really happy, but I will withdraw this amendment until Select File. Thank you.
PRESIDENT ROBAK: Thank you, Senator Robak. The amendment is withdrawn.
CLERK: Senator, just for my purposes, you want to refile it then for Select File, is that right?
SENATOR ROBAK: Yes, I do.
CLERK: Madam President, Senator Wickersham has the next amendment to the committee amendments.
PRESIDENT ROBAK: The Chair recognizes Senator Wickersham.
CLERK: AM1838, Senator.
SENATOR WICKERSHAM: I'd like to withdraw it.
PRESIDENT ROBAK: The amendment is withdrawn.
CLERK: Senator Beutler, AM2000, Senator.
PRESIDENT ROBAK: The Chair recognizes Senator Beutler.
SENATOR BEUTLER: Mr. Clerk, that amendment is outdated and I would withdraw it.
CLERK: I am sorry, Senator.
SENATOR BEUTLER: The amendment is now outdated with the Maurstad amendment, so I would withdraw it.
PRESIDENT ROBAK: The amendment is withdrawn. Next amendment or motion.
CLERK: Senator Chambers, I am now at your bracket motion, Senator.
PRESIDENT ROBAK: The Chair recognizes Senator Chambers to open on the motion to bracket.
SENATOR CHAMBERS: Madam President, members of the Legislature, this is a bill which I really don't like in any form, but I understand that people who have an interest in it, one way orthe other, have been talking and have reached some kind of an arrangement. I never, when I'm not a participant to an agreement, feel that I am bound by that agreement. However, until I hear what it really is, I'm not going to put an impediment in the way of that being worked out, in the same way .that if Senator Wehrbein had agreed with me to reach a compromise on LB 216, 1 would like that to have had a chance to go forth. So the only reason I'm using my bracket motion now to say something is so that on all these other maneuverings, it will be unnecessary for me to speak, but I don't want my silence .during that maneuvering to be mistaken for consent. If I decide that I don't like the agreement that has been worked out, then I am going to oppose it. But at this point, it would not be that
all-out thing like I'm doing on LB 216. LB 216 does not allow any wiggle room. LB 405 (sic) allows a whole lot of wiggling, and I'm not sure at this point, and I want everybody to be aware of this. I am not sure I like the way the Governor has put a heavy-hand into this Legislature. I don't like the way the Governor has tied bills together, but if the Governor is free to do that and the Legislature is going to accept it, I'm going to deal with the Governor the way he is dealing with the Legislature. Now that I'm the longest surviving, longest serving member of the Legislature (laughing), excuse me, Senator Dierks. Now that I'm the longest serving member, I have an obligation, I feel, to help meet those challenges to the Legislature as an institution. The Governor is a politician. All of us are politicians. We know that in politics everything goes. We're all grown. We have or should have thick skins, but I want the Governor to know that there is at least one person over here who is not going to allow the Legislature, as an institution, to be run over roughshod. So I will listen to what we're told, but if the only thing that happens is that people pull off every motion they have pending, then whatever is left when that gets through may become a target for me to keep us on it until we get some discussion that explains clearly, everything A that is entailed in this activity, and I will now withdraw my motion.
PRESIDENT ROBAK: The motion is withdrawn.
CLERK: Next amendment to the committee amendment, Madam President, Senator Janssen, but I have a note, Senator, you wish to withdraw.
PRESIDENT ROBAK: The amendment is withdrawn.
CLERK: Senator Beutler, AM2009, Senator.
PRESIDENT ROBAK: The Chair recognizes Senator Beutler.
SENATOR BEUTLER: I withdraw it, Mr. Clerk.
PRESIDENT ROBAK: The amendment is withdrawn.
CLERK: Senator Beutler, AM2069. (See page 1914 of the
PRESIDENT ROBAK: The Chair recognizes Senator Beutler.
SENATOR BEUTLER: Madam Lieutenant Governor and members of the Leg13lature, this amendment does simply one thing, and it is, of course, addressed to the Maurstad amendment which we adopted, and limits the effect of the income tax decrease in the Maurstad amendment to a period of two years. Under the current form of the amendment, as I understand it, it is a permanent income tax decrease. Now as I understand secondhand as to what's been going on on this matter, apparently certain legislative leaders have agreed that this bill will pass on to Select File. By the rejection of the committee amendments and the pure green copy will pass forward to Select File, and we've all been encouraged to go along with that. Well, since the Maurstad amendment is, apparently, going to be destroyed by the rejection of the committee amendment, there is not much in my point to arguing a modification to the Maurstad amendment. Therefore, I intend to withdraw this amendment also, but I think passing to Select File an income tax reduction that is permanent in nature, and not limited to a period of two years is a major, major error; that should it turn out that way, it's a major, major error and a major, major impediment to true income tax and true property tax reform as we promised it, and I'm interested in hearing the numbers that say otherwise. And so if the committee amendment is rejected, I will offer a two-year limitation on the green copy of the bill, and with that, Mr. Clerk, I withdraw this amendment.
PRESIDENT ROBAK: Thank you, Senator Beutler. The amendment is withdrawn.
CLERK: Madam President, Senator Kristensen would move to amend, 2121, Senator. (See pages 1932-34 of the Legislative Journal.)
PRESIDENT ROBAK: The Chair recognizes Senator Kristensen.
SENATOR KRISTENSEN: Thank you. Madam President, members of the Legislature, and I don't think that we're violating the spirit of any of the discussions that have occurred, but I do think, and I'm not going to pull this right now because I think we're
going to generate some discussion here about why we're proposing to do the ... well, I'm trying to figure out a good way to describe this. The discussions that have occurred occurred for a reason. I think we need an amendment up here to begin to discuss the options as to why we're going to make a proposal to you that is going to be up to the body to accept. What this amendment does is it makes some changes and would strike the committee amendment, as it is, and replace it with a pending amendment that I have, but let me put some background to this. We've got roughly $230 million. If you take a look at the sheet, this morning's sheet, your agenda, and you go do-.,."- on line 36 under this biennium, you'll see roughly the figure in bold print of $230 million. We've got 15 days left, and you've got to decide what we're going to have fit and how this is all going to work together. If you take that $230 million, you take LB 269 and all of the A bills that are out there right now, and that adds up to $39 million. If you take LB 180 or (LB) 806, depending on how you do it, but let's take (LB) 180, because that's out there, that's $200 million. Then you take LB 401, and its current condition, that's $171 million. That's a total of $410 million for this biennium, of which we have 230 to work with. That's assuming that you have a minimum reserve. If you take the reserve up to the maximum reserve, we only have $83 million. So somewhere in here, we've got to begin to make these, things fit, and this is probably where the discussion occurs is how do we make all iese items fit. That's for this biennium. That does take into account the April projections that are out there. The amendment that I have pulls back the rate cut and pulls it back to 4 percent, as opposed to 5.5. It keeps the credit in there and it only makes the 4 percent cut .for two years, but keeps the credit perpetual. Now I'm not saying that that's the magic answer. I'm saying that's going to be one option that you're going to have to live ... to look at, hopefully, on Select File. But I think today it's important that we still discuss this because if you leave the income tax cut in its present form, you're going to create a large expectation of a perpetual cut that's large. I'm not saying it's bad policy. I'm not saying it's wrong, but that you've got some realistic things that you have to deal with inside here that the rest of the state doesn't have to deal with, and that's how you're going to make all this budget fit. If you want to do things for maintenance of buildings, if you want to do things
for property tax relief, if you want to do some of the other things that need to be done this session, you've got to begin to think about how we're going to fit that size 12 shoe into that size 6 ... yeah, that's the way it was, the size 12 foot into the size 6 shoe, but that's real important to begin to look at. If you pare down a little bit here, if you go and fix (LB) 180, you had the opportunity to do that earlier, we didn't do that. If you can take $100 million out of LB 180, if you can make some reductions here on this, some of these things will begin to fit and it'll work, but so far the process has been this session that we go ahead and say yes to everything and we move them along to. the next stage of debate. Obviously, with the condition that the bill is in right now, it's probably not one that will have 25 votes on Final Reading, and that's the reality that the body has got to begin to look at. The reason I have the amendment up here is to give you another option, to begin to make that fit. I believe that one of the things that I will probably do here is ask to have that considered on Select File, but I am going to leave the amendment up at this point in time because I think we need to begin to have a discussion here on how we're going to make all this fit, and what options do we really have. At this point in time, I think there is sufficient number of people who would not vote for the committee amendment. If that's true, you go back to the green copy, which is a permanent cut, and so that's the option that you're faced with at this point in time. Sooner or later, the good times will not continue. If you look at the history of our revenue streams, you have periods of growth. We're lucky, we're in one right now. But it will not always be that high, and you've got to begin to figure out someway, how are we going to plan for that in the future. The purpose for a two-year cut is that at the end of two years you can come back and say we still have this growth, we can vote another one in. The credit is there perpetually as a method of putting some permanency to the cut. If I had my real druthers, it would be just a straight cut in rates and go home. I don't think that's possible, so I leave that credit in there perpetually, but put the cut in rates for only two years; allow us to come back in two years, reassess the situation, and if we still have those excess revenues, you have a policy choice of either putting that money into property tax relief or continue it on the income tax. But at the present time, I don't think you can do the committee amendments the way
they stand and do all these other things that we have out there without allowing a number of vetoes to occur, and we need to begin with 15 days left to examine how you're going to narrow your options down, how you're going to make that size 12 foot fit into the size 6 shoe. So, Madam President, I would yield back my opening.
PRESIDENT ROBAK: Thank you, Senator Kristensen. Senator Withem, your light is next, followed by Senators Coordsen, Will, Wesely, Wickersham, Maurstad, Chambers, Wehrbein, Witek, and Robinson.
SPEAKER WITHEM: Senat ... Madam President, members of the body, first of all let me clarify a point with Senator Kristensen. Senator Kristensen, what I heard you say in your opening is, in essence, you are not offering this amendment arguing that it should be adopted at this point, that it is now up as a vehicle around which we can focus a little general debate and discussion about general concepts of income tax, is that correct? Okay. His mike wasn't on, but if you didn't hear, he did indicate yes, and I think that's appropriate. We did meet, a number of people who have been the most active participants in the income tax debate, and in essence agreed that there are still a lot of disagreements on the concept of an income tax, but that procedurally it is an important enough issue that we should try to facilitate the moving toward an agreement. There is no agreement that exists at this particular point. After we've had some discussion, and I think we should have some discussion. I don't think the concept of cutting income taxes permanently or temporarily ought not to be one that we simply say, oh, it's a .minor enough point that we will just kick the bill over to Select File and not even have a discussion on it. I believe at the conclusion of the discussion, the recommendation will be that Senator Kristensen withdraw his amendment, we'll get to a vote on the committee amendments. I believe the recommendation there will be to vote no on the committee amendments, put the bill back in its green copy form, and advance it on to Select File. That, at least, was, of all of the alternatives we talked about in the meeting we had this morning, the one that received the fewest number of opposition voices. The first time this was suggested, it was nobody's first choice, and then after we discussed it a number of times, we found out it was the only one
that procedurally that people would agree upon. The point, I guess, I would like to make is that there are still disagreements. There is, first of 'all, the very basic disagreement of whether we should have an income tax cut or not. I've come rather late to the game, looking at the numbers, to believe that we do, in fact, need to have some version of an income tax, but I know that is a point of disagreement. If you agree that we do need one, there is still a lot of questions. How large an income tax should it be? Should we support the concept as it came out of committee? Should we support the concept in the green copy of the bill? Should we support the concept that 25 senators, at least temporarily, last Wednesday felt was an appropriate number? Or what is the appropriate size of the income tax cut? If we do, what's the nature of that cut? Should we reduce the rate, should we ... which tends to return the income tax money to demographically one group of people, or should we try to increase the personal exemption, which demographically returns the money to a different group of people. And, thirdly, if yes, how long should it last? Should it be a permanent cut, or the point Senator Beutler brought up, should it, in fact, be limited to a set number of years? Those are decisions we need to reach. If, no, we should not have an income tax, then maybe, and Senator Janssen will give us an opportunity, maybe income taxes aren't the right tax to cut. Maybe sales tax is a more appropriate tax to be cut. Senator Janssen will give us that ... that view. Maybe we should use the money as a larger down payment on the property tax issue that was crafted last year, and I think Senator Beutler's amendment will give us an opportunity to consider that. Or maybe we just ought to leave the money in the Cash Reserve Fund and build that up as a countercyclical set of money for when the economy goes bad on us again, that we can at least maintain state government without tax...
PRESIDENT ROBAK: One minute.
SPEAKER WITHEM: ... increases at that point. Then in addition to that, there are other peripheral issues related to the income tax. Senator Robak, who was in the process of opening on her amendment when the tornado alert hit the other day, and I would have taken that as an omen, had I been opening at that time, Senator Robak. You're a braver person than I am. But proposals
like are there other deductions that we should have within our system, so we still have a lively debate ahead of us. I'd like to see some of these ideas come together prior to the Select File debate. At this point, what we're suggesting to do, though, is to have a general debate today, hopefully, not too long, and then see the bill, in its green copy form, advance to Select File and give us all an opportunity to examine bur position on these various issues that have been outlined here. So, Madam President, thank you very much, and the rest of the time, if there is any left, is yielded back.
PRESIDENT ROBAK: Thank you, Senator Withem. Senator Coordsen.
SENATOR COORDSEN: Thank you, Madam President and members of the body. I suppose much of what needs to be said has already been covered by the previous speakers, but it's important, I believe, that ... that our system of expenditures fits together. At this point in time, as 401 exists with the Maurstad amendment as the committee amendment, there's concern in many quarters that there's more dollars in the bill than what might be available in real life in the next biennium. One of the thoughts that keeps going through my mind is in the late months of 1986, after the general election and before the start of the '87 legislative session, there were two special sessions here to reduce the ... reduce expenditures because we were on the other side, the other side of an issue. And there aren't too many members here yet that remember that, but it wasn't a pretty sight and I came in a couple of days and watched that from the side, as a nonmember, to see what I was getting into, and it really impressed me; that one in here in the euphoria of having money, with resources building up, projected resources building up faster than what we ... what we had anticipated, there is always a danger to commit more resources than what. we can sustain. At the current stage of debate and the placement of the bills on the agenda within the last what is now 15 days of the legislative session, I believe it's appropriate to move the bill over to Select File, and I agree with Senator Chambers, I was adamantly opposed to this simply on a basis of not being the proper way, I believe, to debate issues. They ought to be, in infinite detail, hashed out on General File, then fine-tuned on Select File, and then ought to be in shape for passage if they get past... if they got past Select File. But this in a set of
extraordinary circumstances that we're working in. We have for the past nearly a week now been busy with the General Fund appropriation bills and the various trailer bills that we have addressed, all of which commit a significant amount of resources. As many of you know, I've historically been opposed to income tax rate reductions. I've not been so opposed to credits, because of some problems that I recall going back to the days when we switched our system from a percentage of federal income tax liability to the current system, and how that impacted nondeductibility of a lot of items that people were using and that sort of thing. I do believe, however, that where we're at now and with projections, projections, projections, that it's appropriate to make a ... to reserve the opportunity to make a limited, and I agree with Senator Beutler with respect to having a sunset on the rate reduction, a limited availability of this reduction in potential future income. It's one of many ways of what some people would like to say, returning money to the taxpayers. Actually, what we're doing is reducing the amount that we would collect if this bill becomes law. But I think it's too early...
PRESIDENT ROBAK: One minute.
SENATOR COORDSEN: ...in the process yet, and with the structure of other bills that are behind this, we're not finished with the ... with all the Appropriations Committee bills, and we don't know what the total of that is going to be, we don't know what we're going to end up with, with respect to property tax relief money, it's appropriate to move this over. And when I say this, this is not saying that I'm going to support it, and I don't think that any of the other people that have spoke this morning are committed to supporting the green copy of the bill, and I would hope that there isn't a misunderstanding communicated between here and the lobby or the Rotunda. This is a process to provide us an orderly transition of how we ... how we use these projected available resources and to see what fits. Senator Kristensen went into some...
PRESIDENT ROBAK: Time.
SENATOR COORDSEN: ... amount of detail on that. Thank you, Madam President.
PRESIDENT ROBAK: Thank you, Senator Coordsen. Senator Will.
SENATOR WILL: Thank you, Madam President, members of the body. I rise in what I would characterize as benign opposition to the Kristensen amendment. I understand what Senator Kristensen is doing by bringing this amendment forth to augment debate on this bill and on the possible ramifications and structuring of an income tax cut. I think that when you look at Senator Coordsen, Senator Withem, Senator Kristensen and myself, you probably have four different angles on a potential income tax cut, but I think the bottom line, as far as that goes, is that there is a need to advance this bill, and my preference would be, as has been outlined by other speakers, to, number one, not... either defeat or not vote on, hopefully, Senator Kristensen will pull. this amendment, and not vote on this amendment; number two, dispose of any other amendments that might be out there. Finally, I would suggest that the most pristine way to handle this right now would be to vote down the committee amendment, which I support by the way, as currently structured with the Maurstad amendment, and then advance the green copy of the bill, and move this discussion to Select File. I think we are at the point in the session where we need to be making key decisions. Those decisions I think on a number of other bills have been deferred to Select File. I think this bill, as well, is a very good candidate for that, if not a better candidate than some other bills that we put forward. With that, I would simply hope that the body would do that. There are a number of debates that need to- be settled on this bill with respect to are we going to make a rate cut; are we going to do some personal exemption that is permanent? Is either of those going to be permanent or be sunsetted at some point? I, personally, favor a rate cut as opposed to an exemption increase and making that rate cut permanent. Obviously, you've heard that that is not a position that is shared by all, but I think the best move we can make right now is to get rid of the amendments, advance the green copy, and defer this amendment to Select File. With that, I would give my remaining time to Senator Maurstad.
PRESIDENT ROBAK: Senator Maurstad, there are two and a half minutes remaining.
SENATOR MAURSTAD: Thank you, Madam President. I would like to address this from a slightly different perspective than we've addressed it so far, and that's that we have an opportunity to look at this from the perspective of our state spending, property tax relief and the income tax cut, which I believe can all be done. Now we're, obviously, having to focus a little bit more on the expenditure side than we were before with the adoption of the amendment last... last week, 25 members felt was the appropriate ... appropriate thing to do. It still can be the appropriate thing to do, but assuming that Senator Kristensen, as has been indicated by the Speaker and he, are going to withdraw this amendment, I think it's important that we keep in mind what the overall level of taxation is. Senator Beutler passed out a handout. If you'll look, state taxes are two full percentage points historically higher than local taxes. Our state spending is going to increase at a pretty dramatic pace this year, given the increase in property taxes, which I think we can justify, but also just in operations, we're increasing at a time when we're asking local governments to watch themselves. So I think that's an important factor to keep in mind, but right now there's only demonstrated support for the amendment that I feel improved the original committee amendment by restoring the 5 1/2 percent permanent rate decrease. Now we go back, if we advance the green copy, we're at 5 1/2 percent of permanent rate reduction, which I can be supportive of. That's ... I originally supported the Governor's proposal in that nature, and, of course, then those that are able to generate 25 votes will be able to add potentially a credit. Potentially, they will be able to make it permanent or otherwise, which I happen to believe is going to be the focus of the discussion ultimately, is the rate reduction going to be permanent or not? Now, I haven't been around as long as others, but I know that our forecasting now is certainly different than the forecasting process was ten years ago when we had those difficulties, and that may have been one of the reasons that we now have the Forecasting Board that we have now to provide guidance...
PRESIDENT ROBAK: One minute.
SENATOR MAURSTAD: ... instead of the Legislature doing It. So I think our forecasting is a lot better, and I think that we can sustain what was adopted the other day. We'd have to look at
some changes, but we need to manage the budget, not let the budget manage us. And I think we can do that, but I thin k to do that, we're going to have to look at state expenditures, and one thing I think this year demonstrates is if there are funds there, we will find a way to expend them at the state level. When we started this session, I believe anyone who was interested in property tax relief in additional state aid to local government would have been very satisfied with around a hundred million dollars to help with that effort through this. biennium. I -think we can do that. The income tax cut, I want to reiterate, won't compete with that.
PRESIDENT ROBAK: Time. Thank you, Senator. Senator Wesely.
SENATOR WESELY: Thank you. Madam President and members, Senator Chambers talked about being the senior member here and having a sense of obligation. Senator Landis and I are tied for second in seniority and I feel too young to be that old, but I'm sure he feels the same way. Let me tell you that I've been through this before, twice, as has Senator Landis and Senator Chambers. Senator Chambers has been through it actually three times. This issue is not new and the concepts are not any different, particularly, and the scenario not very different than those other three times that we've faced this situation. Those years were '74, '79, and '89. In '74 and in '79, we ended up increasing state aid and decreasing income taxes. Several years later, not very far into the future, we ended up with deficits in our budget and had to end up having ... cutting budget, special sessions that were quite painful. I've been through them, and ... and they hurt. They hurt a great deal. We thought that we could do it then. Some people think we can do it now. I think we ought to learn from history. Some people say that the only thing you learn from history is you never learn from history, you just repeat your mistakes. I hope we don't do that again. I hope we do learn from history. We have on the table a state aid increase. We have on the table an income tax cut. We've had that same scenario before. We've moved forward with both, and we've paid the price. Let's learn from that. Letts not take too deep a cut in the income taxes. Let's not get ourselves in the position a few years from now that will be detrimental. I know all of us think four years from now, three years from now, that's off in the distance, I'll
be gone or it won't matter or somebody else will take the blame. Well somebody's going to pay the price, and that somebody is the state of Nebraska. And that's our responsibility, each one of us, 49 of us, each are here representing not only Nebraska today, but Nebraska of the future. And that means we have to think about long term, the impact of these changes., And we can't be promising everything to everybody. We can't do it all. We can't increase the state aid. We can't increase the state budget. And we can't cut the income taxes and cut the property taxes and do it all and have it balance out, not to any significant degree. And there are promises being made and people are being sold that line. And I think that they're being misled because I think the lessons of history tell us it doesn't work in the end, it doesn't balance out. So back in '89 we didn't end up increasing state aid, we only cut the taxes. But we still ended up, as Senator Landis remembers, with special session after special session, cutting the budget in the middle of the year, hurting programs, hurting people. And, and so again we've seen the impact of not looking farther into the future. So I'm asking all of us, I know the effort here is to be nice and to go ahead and advance the bill off of General File. I'm not going to support the effort to advance the bill. I see a three train crash coming between the effort to cut the income tax, the effort to provide for a decent budget as the Appropriations Committee has submitted, and to provide for decent state aid to make up for the losses of revenue to our schools. And I think the ultimate thing we have to think long about here Is our schools and our overall standing as a state that cares about people. Our health and human services have been cut tremendously. As a result of that we have had some savings, and that's reflected in some of the ability to provide for this income tax cut. We can't lose eight of the fact that we're last in the country in community-based mental health funding. We can't lose sight of the fact that we have over 1,000 mentally retarded individuals waiting for services, and now we're going to cut 'back, Senator Tyson and Senator Bohlke and across this state, regional centers because we have to come up with the money. We are looking at major cuts and continuing to have major cuts in health and human services. And our schools are going to feel the impact of 1114 in a way that we can even know fully at this point in time. Those are significant cuts. I think there's some kids out here that'd
like to talk to us. There's some kids up here that come visit US. And every day we talk about how important the kids are and how important their education is. But in the end are we going to really stand by them and make sure that our schools aren't hurt? We can all find efficiencies in our schools, we all want them. I've supported school consolidation, I've supported different...
PRESIDENT ROBAK: One minute.
SENATOR WESELY: ... efforts to save money, but it's never to the degree that we're talking about of the hundreds of millions of dollars under 1114. We have got to deal with that. We can't let our schools suffer and our kids suffer. It's the one thing that Nebraska can be most proud of, I think, is our excellent public education system. It's what makes us special. our kids graduate, they do well on national exams, they do well as they enter college, they do well as they enter the work force and part of that is our excellent school system. We don't want to lose that. So again, I know there's an effort to cooperate and move forward. I think that at some point we got to say no to some of this. We can't do it all. And the thing I think we need to say no to is this income tax cut, particularly on a permanent basis, particularly as deep as has been proposed. And what we need to move forward on is the property tax relief that we promised, and we have to move forward on a decent budget that makes up for the fact that we haven't got 100 and $200 million worth of deferred maintenance because we haven't kept up. We have got longstanding unmet needs. We ought to meet those needs and we ought to deal with the problems that we face. Thank you.
PRESIDENT ROBAK: Thank you, Senator Wesely. Senator Wickersham.
SENATOR WICKERSHAM: Thank you, Madam President. I think it is a little bit surprising what a weekend of reflection will do to bring a body to its attention, because last week we, by a very narrow vote, voted to spend $287 million. Today, I'm hopeful that we're going to vote to cut that back, that we'll actually vote to defeat the committee amendments. Last week, I Indicated to you that in my judgment at that time, and it's still my judgment, that that was too much, that we could not afford to do
that. That's still my judgment. That doesn't mean, however, that I won't support some income tax reduction, at least over the next two years, because I think that's entirely appropriate. I do not think that we need to collect all the taxes we can possibly collect, nor do we need to spend all the taxes that we can possibly collect. We don't need to do either one, and because of the unusual circumstances that we have had, both with a reduction in expenditures in the current biennium, and an increase in projected revenues, we do have an opportunity to reduce income taxes for at least the next two years, and I will certainly support those efforts. Beyond the next two years is far more difficult. Last week we had a discussion about whether we really need to be concerned beyond the two years, and I think we do. There are others who are far less concerned about years three and four, but years three and four are going to be there, and as Senator Wesely indicated, some of us are going to be here, and we're going to have to deal with years three and four. So we have got to think about them and we have got to think about what's going to be happening in those years. One of the events that will occur in years three and four that we have not yet discussed is the reduction in the property tax lids for schools and community colleges. Schools will be reduced by ten cents, from $1.10 to $1.00. Community colleges, over that period of time, will have been reduced from 8 cents to 6 cents. I think that is going to create a demand for approximately $100 million extra for property tax relief payments from the state. That is not on your green sheet. That won't be on your green sheet, but that should be in your consciousness, and it should be in your thoughts as you try to determine whether or not we can really afford a long-term income tax reduction when we have an existing agenda to lower our reliance on property taxes. I don't want to beat a dead horse, but last week I indicated that we have, if you're examining our tax structure in the state of Nebraska, we are the 16th highest state in the nation in our reliance on property taxes. We are only 27th for income taxes. So it seems a bit incongruous that we're to spen...we're going to spend a lot of time on an income tax debate when our problem is continuing to be property taxes. Now some will say that the property tax issue is simply an issue of local spending, and they have to cut local spending. There is a problem with local spending, but it isn't that big a problem. We cannot cut $300 million approximately, as would be called for
by 1114, out of local budgets and still expect to have decent schools, decent roads, decent municipal services, any kind of decent local governmental services and programs in this state. We can't expect that. And if we can't expect that, that means that we have to be able to step up to the plate and assist them. I'm ready to assist them, and I hope the rest of the members of this body are ready to assist them; either assist them through the mechanisms of (LB) 180 or other mechanisms, but we have to be ready to stand up to the plate and assist them to meet the objectives that we have set with 1114.
PRESIDENT ROBAK: One minute.
SENATOR WICKERSHAM: And in about three years, that's going to require another $100 million, and you would do yourself a service if you penciled that in at the bottom of your green sheets every morning when you see them, I guess maybe this year they are going to be blue, just to remind yourself that there is another 100 million waiting to fall into place.
PRESIDENT ROBAK: Thank you, Senator Wickersham. Senator Maurstad.
SENATOR MAURSTAD: Thank you, Madam President. Senator Wickersham raises some interesting... interesting points, of course, and that deals with to what extent should the state assist local governments in meeting their mission, and I would contend that if we look at what has occurred over the course of the last 25 years, that there has been a continual effort on the part of the state to try to help and work with local government in reducing the reliance on property taxes, but you cannot ignore spending at the local level, and you cannot ignore spending at the state level. I have to correct Senator Wesely, ,unless Senator Wesely has a lot better knowledge of the budget than ... than I do, and he can maybe point out to me where the major Cuts are occurring in the area of health and human services because those areas are not being cut by the budget that's brought ... that we've been ... that we are working...working on, and I also want to draw your attention to the biennial budget that we presented to you in the recap that was presented by the Appropriations Committee, on page 23, it indicates what the historical General Fund appropriations are. The last ten
years, the average has been 7.5 percent average growth in General Fund appropriations. Now I don't see a lot of fiscal constraint in that number. We have to look at whether or not we can continue to spend at the level we are for state operations, not provide the ability for local governments to do so with a freeze on their spending, regardless of what we think in wanting to assist them, we've taking away local control, and we've taken away local control because we've ... we've indicated by our actions at the state level that local governments can't make those types of decisions for themselves, and so I'm convinced that when we're in the process of going to receive more income taxes than we need to sustain even a current high level of spending, that we need to make a rate reduction, so that we don't bring those dollars into the coffers knowing that what we're going to do is spend them for increased growth in state government. And all you have to do is look at the A bills that we have before us to show that we have not shown constraint this year on the growth in state government. Now that may be what the majority of the senators want to do, but to couch this as income tax versus property tax to me is not demonstrating the whole picture. We have to watch our state spending. The way that we're going to provide ... you know, the best measure for that to occur is when we start out with the whole process, we know that less funds are coming in, that we've left those dollars in the pockets of our taxpayers to use on their children, such as are with us this morning, for those things that they feel important, instead of sending those dollars to the government for government to spend on what we think is important. And we have a responsibility at the local level regardless of where we live. We, at the local level, can decide what we went to spend our resources on. Every community is different, every school is different. But those decisions need to be made at the local level, and then funded for them at the local level, and the priorities then are going to address where one is in relationship to what they can afford...
PRESIDENT ROBAK: One minute.
SENATOR MAURSTAD: ... and not expect someone else to provide those resources for them. Now back on task, I would say that it is important to me that we have an income tax cut this year. I think the citizens of the state expect that.. We can afford
that. I think that income tax cut needs to be a rate reduction, and it needs to be permanent, and that's what I am going to continue to support and work for. I think it's important that we move the bill on to Select File. I am willing to give up the advantage that was gained last week for that to occur, but if things, depending upon what happens in the rest of the discussion before we get to the committee amendment, that, of course, can change based on other amendments that may or may not be filed, but I hope I'm clear, my emphasis is a permanent rate reduction. I think we can afford it. I think we can do it along with the commitment that we have to local government through LB 1114, but we can't spend our way to property tax relief.
PRESIDENT ROBAK: Thank you, Senator. Senators Coordsen and Maurstad announces the following guests are visiting the Legislature. There are 75 fourth graders here from Jefferson School in Fairbury, Nebraska and their teachers. (Introduces teachers.) They are all seated in the north balcony. Will you stand and be recognized, please. Senator Chambers.
SENATOR CHAMBERS: Madam President, members of the Legislature, I've got to say this to my colleagues, you all don't listen to me. You don't hear a word that I say, but I am going to show you how right as rain that I am. Those few who may have been here, did you hear me say that 7. read in the newspaper, Senator Wehrbein, because you were listening, that the Governor said he had Senator Withem's support on the income tax cut, did you hear me say that? And did you hear me say that means there are no problems on this bill? Did you hear me say that? Did you hear me say that means this afternoon the bill is just going to fly right over to Select File? Did you hear me say that? That's what I said. Check the transcript. That's what I said. And what are they preparing to do? Fly it right on over to Select File. You all don't pay attention to me, but you need to. You'd be watching that psychic network and you get this free but you don't recognize and realize what you've got in your midst, but that has happened before. I just love for these moments to come and I like to call the shot in advance. Then those who wish that I were wrong just have to sit there and swallow spit and be angry and say, by God, how does he do it? Well, that's how I do it. But I want to ask a question. This is a
rhetorical question, so I think I'll ask it to Senator Wehrbein, my worthy opponent.
PRESIDENT ROBAK: Senator Wehrbein.
SENATOR CHAMBERS: Senator Wehrbein, based on the way I've been pummeled and run over roughshod by this Legislature yesterday and today on LB 216, why should I relinquish this hostage? Why should I let 401 go, in your opinion?
SENATOR WEHRBEIN: I think you should let it so we have a menu out at Select File so all the things could be considered, and in the meantime, a bolt of lightening may strike you and you may change your mind.
SENATOR CHAMBERS: But awaiting...awaiting that contingency, if you were situated as I am, and had been bludgeoned and battered and you don't have enough votes to do a certain thing, but there is some other strategy you can use, would you relinquish that strategy and accept defeat, ignominious defeat graciously?
SENATOR WEHRBEIN: Well, you know, I think you have to make that decision yourself. I can't make it for you, but I do think you need to decide where you are going to make your stand and be firm and consistent; rather than use a shotgun approach, use a rifle.
SENATOR CHAMBERS: I am asking if you were situated as I am, what would you do?
SENATOR WEHRBEIN: if I was situated as you, I probably would try very hard and then I would let this... let it go because of the will of the body. I believe... I could give you a grandiose talk about democracy in action.
SENATOR CHAMBERS: Thank you. I saw democracy in action this morning by the way you all dealt with the court system. You want me to let this multimillion dollar bill Just slide on over to Select File and yet you all dug your heels in on $1 million. I told you we were going to come to this, and it happened the very ... the very day, and now I suddenly am to be collegial. Senator Schellpeper, if what happened this morning had been a
literal boxing match, my eyes would be swollen shut; I'd have cuts in my eyebrows; my nose would be hanging off my head; my lips would be split. I wouldn't. know whether I'm coming or going, and if I was going to try to make it to my corner to take my stool, I'd be stumbling to the wrong corner. That's how badly beaten and bludgeoned and bloodied I am, and now I am being told by those who participated in this pummeling, this merciless, brutal pummeling, Ernie, forget it, let bygones be bygones. We want it our way, so you go along with us, and the next time you come up again,...
PRESIDENT ROBAK: One minute.
SENATOR CHAMBERS: ... we I re going to slam the door on you and kick your teeth in again. And that's what they're telling me and that's what I'm supposed to go along with. I'm thinking about it. I'm considering the possibility, but I have not made up my mind that that is the right thing to do. I just wanted that opportunity to gloat and remind you of what I told you this morning was going to happen and you see it unfolding. Well, maybe with a little help from me, you will see it unravel, but I am not sure yet. I may become somewhat collegial before the day is over, but I am not in that mood right now.
PRESIDENT ROBAK: Thank you, Senator Chambers. Senator Hudkins announces that there are 18 fourth and fifth graders, students here from Raymond Central Elementary, with their teachers, from Valparaiso, Nebraska. (Introduces teachers.) I believe that the students were in the south balcony and that they have left. Senator Wehrbein, your light is next.
SENATOR WEHRBEIN: Madam Speaker and members, Senator Chambers, did you have lunch?
PRESIDENT ROBAK: Senator Chambers.
SENATOR CHAMBERS: The Legislature is going to be my lunch.
SENATOR WEHRBEIN: Okay, I was wondering that. I wondered why you changed your mood. I am going to be brief today. I, at this point there has been quite a few good points made I would say on where we should head. I am going to support advancing
LB 401 in the green copy, not that that's where I will necessarily come down, but I think it is something that we ought to be able to consider. I, myself, would like to see how the debate proceeds on the mainline budget bill, in particular, the construction bills and others, to see that at least they hold their place and at the spending level that they are at. There are some discussion points in there that I think the body will want to take up. I do think there may be room for an income tax cut in due time at a somewhat modest level. I'm not sure at all what that level is. I will say one of my concerns is that whatever we do I would hope that it would be at least able to be permanent, if at all possible. I think that we would do ourselves a disfavor if we would take too large a cut at this time, or give too large a credit, and then find ourselves with problems in a couple of years. Prediction is an inexact science at best down the -road, and we've had some strong revenue growth years in Nebraska. Certainly the implication from that is we should reduce income tax, and I would be definitely for that if I am sure that it can be sustainable, especially into the out years, so I think we have to look at that because I think one wor ... one thing people dislike more than high taxes is having them go bouncing back and forth. I think we need to have a steady, predictable economic environment or economic climate in Nebraska. I think to the point that the Legislature can do something about that in terms of expenditures and income and revenue growth, to the extent that we can manage that, we ought to, and we ought to have a steady and dependable business environment, if you can, and an economic environment, educational environment, and what all. All these things ought to fit and we ought not to be bouncing around. And so I think it behooves us, if it's appropriate, to advance 401 with the green copy; it would have some sort of cut ... cut in it, but then we can see on Select File as to what will and won't fit. We'll have a much better idea after especially we have debate on LB 389, because I know there is going to be some amendments filed to it. Actually, I think there may be some cuts, there is some transfers and some increased spending, but we will have a better idea as to what ... how the income tax can fit into it because I, myself, also think that property tax relief is one of the crying issues across this state. It affects more people more broadly than the income tax in many ways, and we need to get the education situation, the financial situation there at
least a little clearer, a little more in focus, and a little more idea of what those dollars will be before we can really come down on the...on the final decision on the level of the income tax cut. And with that, I hope Senator Chambers doesn't feel too badly. I would like to think that there is at least a bloody stump or two sticking up down there in front of me. I think he's not out or down at this point, but I think that I would try to reserve some of your strength for another day, Senator Chambers, and if you have to let us roll over you a little bit somewhat lightly today, I would urge you to consider that. Thank you.
PRESIDENT ROBAK: Thank you, Senator. Senator Robinson.
SENATOR ROBINSON: Madam President, members of the body, just a few comments. I stand for a permanent cut. I don't know what it should be, but I think... I think we're just hoodwinking the public if we say it isn't going to be permanent, and I have been around here long enough, at least one thing I know, if the money is out there, there will be plenty of opportunities to spend it. You know it and I know it. I sat through the hundred million dollar cut on the Appropriations Committee the first year I was here, and it's not easy, and I think the last thing we should do is to overspend. I'm not sure what the income tax reduction ought to be, but I feel it ought to be permanent. If the Legislature, if they are going to cut it, if they are going to cut it back, they have got to vote to cut it back. It is just ... let's just not have it for a couple of years and slide back to where we were a couple of years ago. I think ... I think the Legis...that's what we're down here for, face the ... face the problem, face it head on. And you know, it's real interesting, we talk about income tax reduction, and I don't know how many small schools out there, they are chomping at the bit, and I see why they are chomping at the bit, and, you know, any way you look at it, their income taxes aren't going up ... excuse me, I am sorry, their income tax, or excuse me, their property taxes are not going to go down. Either way you look at it, their property taxes are going to go up. Well, we say it is sort of a side issue. Now if you have got one school, it's real. easy, but if you've got eight or ten schools like me, it's a little different, and we don't care what the others are doing, we'll just take their money and we'll spend it again. But we ... we
also ... we have several schools that spend below a dollar and some around 90 cents. So what are we going to do? We're going to take money away from them. They've economized. What kind of a message do we send the people of Nebraska? They are probably thinking, my gosh, what's wrong with those people down there in Lincoln because that doesn't make sense. It really doesn't make sense. So I would just close in saying that I am for a permanent cut. I don't know how much it should be but it should be a permanent cut. I think the people of Nebraska deserve it. Thank you.
PRESIDENT ROBAK: Thank you, Senator Robinson. Senator Vrt13ka, your light is next, followed by Senators Hillman, Kristensen, Dierks, Beutler, Abboud, Coordsen, Schellpeper, Dwite Peterson and Tyson. Senator Vrtiska.
SENATOR VRTISKA: Oh, excuse me. Thank you, Madam President. I was interested in Senator Robinson's discussion when he talked about the inability of many of the schools to, obviously, cut property tax, and, in fact, that's going to be true. The purpose of- the hundred million dollars was supposedly to make room for property tax relief, and we all know -that that's not going to happen in those districts where, in fact, they are not going to have enough money to sustain the programs that are in place. And I think that equity is not certainly being followed, but that's another subject. I think that Senator Withem, in his opening, made some very good comments when he talked about the possibility ... discussed the possibility of no income tax, sales tax cut, money put in reserve, money in the trust, whatever. I think those are all options we probably ought to look at maybe none of them will come into being but we need to, at least, discuss it. And while we're on that subject, you know, there's been some rumors, and I don't know how accurate they are, there's been some rumors about maybe putting another 15, 20 million dollars in the school aid package. If we do that, in fact, then it means again we're going to have some of those dollars that we're talking about deferred or put into another program and that means there is not going to be that money out there. We did a lot of discussion on this the other day, and I have to tell you that I'm not going to stand here with my feet against the wall and say I won't support any income tax cut. That's never been my intention. What my intentions have been is
to look at how we can, in fact, alleviate some of the property taxes that I've heard ever since I've been up here, and even before, that the high cost of property taxes by the citizens and their desire to see something done about it. So I think if we're, in fact, talking about an income tax cut, we ought to also talk about some assistance in the property tax field. You know, I think I told you this the other day, but I think it bears repeating. When I was on the county board and we dealt with budgets all the time, one time the State Auditor told us we had too much reserve, the same thing we're talking about here. The State Auditor said you got too much money in reserve, you should spend some of it. And it was the decision of the board, and, by the way, I opposed it, but it was the decision of the board to cut taxes that particular year by a considerable amount. You know what happened without me telling you. The economy got a little bit... a little ... the amount of money that was taken in by the county got less and less, and so what did we do, we turned around and raised taxes. And as I said the other day, we never got any praise for cutting taxes, but I can assure you a lot of people came in upset when we raised taxes. They had forgotten all about it. I think we have to play the thing rather cautiously because it is okay to reduce more money than we need, and I'm not... I never have been in favor of collecting more money than we need for our programs, but I don't want to see us in a position where in a couple of years we've got to come back here and say we have to raise taxes because we don't have enough to provide the services that people want. And there, again, I'm certainly not a person who believes we need to take in more money so we can start new programs that we can't sustain when we do have a downturn. I think that's the worst thing that can happen and we can get ourselves into a box where we start these programs because the money is there, and then, all of a sudden, we find out we don't have enough money, so we have to make an increase in the amount we take... amount of money we take in so we can support those programs. That's why I am not standing here and saying that I will not support any income tax cut. I think it needs to be adjusted according to what we think we can really afford and not, in fact, cut into these programs that we are now sustaining or supporting, and not shorten those programs. I also really believe, and I guess I would...
PRESIDENT ROBAK: One minute.
SENATOR VRTISKA: ...like to hear more discussion but I think a sunset might be, in fact, not too bad an idea. Just for the final moment that I have, I want to tell you that I will support the moving of the green copy. I don't think that we ought to...we ought to advance the bill, the amendments that were on the other day because I think the green copy, to me, makes a little more...works a little bit better for all of us. I just think the property taxes are high because the formula the way we've got it right now needs to be adjusted, and I think we need to take a look at both ... both areas of taxation and try to be fair, and I support the people in my district but I also support the state of Nebraska. And whatever is good for the state of Nebraska happens to be, in most cases, good for my district, so I'd hope that you'd take ... be very cautious when you look at these things and take all these things into account so that we, in fact, don't end up in a couple of years having to turn around and raise taxes and certainly make a lot of people in the...
PRESIDENT ROBAK: Time.
SENATOR VRTISKA: ... state upset. Thank you, Madam President.
PRESIDENT ROBAK: Thank you, Senator Vrtiska. Senator Hillman.
SENATOR HILLMAN: Thank you, Madam President and members. I think it's important, I guess, that everybody voices their view on this particular bill and the income tax cut and why we're doing what we're doing. The process that Senator Kristensen introduced, as far as advancing to Select File, or if we do it here or on Select File I don't, I guess, have any real preference for, and whatever I think probably the Revenue Committee thinks would be best for us, we could follow their lead. But one of the things I would like to do is to kind of look at the whole tax structure, what we're talking about here, and what it's going to mean in the future, and I have passed out an article that was done in a local paper that I have that looks at where Nebraska is in positioning, as far as taxes go, and with surrounding states. Much of the income tax reduction, I believe the justification for that, number one is looking at "economic development" and that is looking at the economic
health of the state of Nebraska and how an income tax reduction affects that. So if you look at the handout that I had, you'll see that as far as living in the Panhandle, and I really don't know about Iowa or Kansas, they don't affect the western part of the state too much, but if you look at what happens in South Dakota, Colorado, and Wyoming, you'll see that as far as the state income tax goes, Nebraska is 6.99 percent, there is none in Wyoming, and there is none in South Dakota, and there is 5 percent in Colorado. It gives a pretty well overall picture there of all the taxes, and we don't come out really well when we look at the competition. Now there is a lot of reasons for that, and if you go on in the article, you'll see that Steve Molnar from the Nebraska Tax Research Council is one of the gentlemen they are quoting here, and, basically, in Colorado and South Dakota offset taxes that are paid by individuals, the gambling that was initiated, and I did not vote for the gambling bills, by the way, but Molnar says Colorado has the sixth highest earnings in the country from casino gambling is what they use. Wyoming has taxes from oil and minerals, and so through a severance tax, they are able to subsidize, I would call it subsidize individual taxing. Colorado has a big tourism industry, they have a lot of people. There's a lot of reasons that, perhaps, there's a tax base in other states that we do not have. So reducing the income tax I think is something that could make us economically much more competitive. That won't happen if we have just a temporary. If we look at a temporary income tax reduction, those that are looking for... looking at us in any way of being more compatible or easier to do business in, that won't happen with a temporary tax increase or decrease. So if anyone is looking at a temporary tax increase in the area of economic development, a temporary one I don't think will do it because they will assume we will just go back up, and so we will still be bypassed in that area. The other thing I would like to refer you to is page 13 of the budget book, and there is a figure there that looks at, for the fiscal year '97-90 of the General Fund revenue forecast, now that is not an assumption in the out years; that is a revenue forecast coming up, and it shows where we have the sources of our tax base, and it shows that our revenues come from corporate income taxes, 6.5 percent; the miscellaneous tax is 8 percent; sales tax is 38.3 percent; and individual income tax is 47.2 percent. I was here in 1990 when we began the seesaw with taxes and the 100 million being
struck down on a local level.
PRESIDENT ROBAK: One minute.
SENATOR HILLMAN: And one of the things I heard over and over again is between the property tax, the income tax, and the sales tax is we need to go back to the original intent, which is a third, a third, and a third. I think we have the opportunity now to look at an income tax reduction, a meaningful one, and an ongoing one, that will ... we can sustain for awhile. If you need a couple of years to go back and look at what we need to do next in more aid to government, but then look at a different source for that aid. I think at some point in time the sales tax issue has to be revisited, not necessarily by increasing it, by broadening it, and that sales tax needs to be a stronger component in a source of our revenues in balancing out all three sections of property tax, sales tax, and income tax, and that would bear, I think, some looking into and to see our total tax picture versus our expenditures and how they would come down in the future.
PRESIDENT ROBAK: Time.
SENATOR HILLMAN: Thank you.
PRESIDENT ROBAK: Thank you, Senator Hillman. Senator Kristensen.
SENATOR KRISTENSEN: Thank you, Madam President, members. There's a...there's, obviously, a number of different, philosophies here. If you begin to look at this, how many of you, when you went back to your constituents, said, what should we do with the surplus, assuming there is a surplus? Most everybody is going to say, well, do what you need to do, but don't do new spending, don't put in new things into the base, don't just pump this up so that we've got to raise taxes in the out years. If you have to do maintenance with buildings, do things that you've put off, do them, but don't put this into new spending. This is not inconsistent with doing that, but things that you've got to consider, look in two years what the situation is going to be. Everybody right now is talking about a $1.10 for levy limits. That's only for a year or two. The
real levy limit is a dollar, and when this biennium gets done and we move into the next biennium, you're going to have people back here wanting 60 to 70 million dollars of new money to replace what they've lost in the property tax. There are some construction projects that are out there. Senator Wehrbein has been talking to you about that. That money is going to come on line and that is going to be expensive in those years as well. They are going to hit at the same time. So you need to begin to prepare yourselves and say, okay, if times still remain as good as they are today, and I've got those other expenditures coming, what do I want to do? Factor in what happens if the economy goes down. What happens if times aren't as good as they are today? Then you are going to be looking at a tax increase when the economy is going down, and that's not going to be easy, and that's not going to be fun, and that's going to be a lot harder. And so at the same time that you're going to be looking for another 60 to 7 million, 60 or 70 million dollars for property tax levy replacements, you're going to have a downturn in that economy. This is all about risk. And Senator Hillman, I think she probably is going to be fairly a high roller with that. She'll say, let's go ahead and make that permanent cut. Senator Robinson said let's go ahead and make that cut, and if things turn bad, we'll just take that risk. I'm not willing to take that risk. I think the vote that we had the other day that Senator Maurstad brought forward was a vote to say that we're willing to do an income tax cut, and I don't have a problem with that, but I think it's a cut that binds this Legislature to the point of making it incredibly difficult to run state operations if we have a downturn. I am not willing to assume that risk. If the economy still stays good in two years, it's very easy, you do what the easy thing to do is and you vote for another cut at that time. It's a less risky way of running the state, and so I know there are people that want to talk about stability of rates and they want to talk about economic development and all those sorts of things, but the bottom line is you still have an obligation to run the state with state dollars, and if you are willing to take a big risk, then I would put in a healthy permanent cut. If you want to reduce your risk and still have a permanent cut, you make the cut lower. You make the rate reduction lower. Don't leave the rate reduction high, make it permanent, and hope the good times are going to continue because they won't, and you're going to have all these other issues out
there that you're going to want to spend money for in two or three years, and you are going to wonder back to what did we ... whatever happened...
PRESIDENT ROBAK: One minute.
SENATOR KRISTENSEN: ... and remember when we- had $230 million, and every time that we have higher revenues come in, we increase state aid and we cut income tax, and in four years we come back and we do budget cuts, and we do more budget cuts. It's a cycle that we've done. We'll do it again, and so that's the reason that I put an amendment up here. I hope that when we get to Select File, if we get that far, that you'll consider that there is many other things that you're going to want to spend your money on -in two years, rather than just taking the money off the table now. And that's what this debate is all about is, how much money you're taking off the table? So, Madam President, could I ask, Madam President, how many other speakers are there .with there lights on at the moment?
PRESIDENT ROBAK: Nine, Senator.
SENATOR KRISTENSEN: I'll leave the amendment a tad longer, and thank you.
PRESIDENT ROBAK: Thank you, Senator Kristensen. Senator Dierks, your light is next, followed by Senator Beutler, Coordsen, Schellpeper, Dwite Pedersen, Tyson, Abboud, Will, and Wesely, and Maurstad.
SENATOR DIERKS: Thank you, Madam President and members. I'd like to have a visit with Senator Kristensen, if I may.
PRESIDENT ROBAK: Senator Kristensen, will you yield?
SENATOR DIERKS: Doug, I am going to make a couple of statements. I'd like you to respond to them, if you would. The scenario has been set out as we go through all the amendments that are on the bill now, they are withdrawn, we vote on the committee amendments, it's voted down, and the bill advances to Select File without any amendments on it, is that right?
SENATOR KRISTENSEN: Yes, Senator, that's my understanding.
SENATOR DIERKS: What advantage do we have having that bill on Select File over having it on General File without having the amendments on it as the green copy, original green copy?
SENATOR KRISTENSEN: Are you asking me my personal opinion, or what I think the Legislature's advantage would be?
SENATOR DIERKS: Well, let me... let me just tell my -personal opinion,...
SENATOR KRISTENSEN: Okay.
SENATOR DIERKS: ... and you tell me.
SENATOR KRISTENSEN: Okay.
SENATOR DIERKS: We went through this scenario last week on LB 806. 1 rejected that proposal at that time, and I think it was wrong then. I think it is even more wrong today. I can't see where if we do this to this bill today it is going to make it right tomorrow. When the bill is on General. File, we have all the more opportunity to adjust it and get it in the position we need it in. If we get it to Select File, those opportunities are lessened. What is your response to that?
SENATOR KRISTENSEN: My response to that, Senator Dierks, would be that I see 806 as a formula. I see (LB) 806A is where the money is at. I see (LB) 180 is where the money is at, and I see 401, and those three, not (LB) 806, itself, but (LB) 806A, (LB) 180, and 401 being all these mechanisms that are going to deal with the surplus. The attitude with the other two were that we are going to wait till the end to decide how to cut up the pie. I'd like to see my amendment be attached, quite frankly, Senator Dierks, now and have that be the one that gets voice voted over on Select File. I don't think that's possible, I don't think it's going to happen, so I live with that reality that I'll live to fight another day on Select File, if we get that far. But, personally, how do I see that is those are the three ways to use the surplus, and if you're going to have...if you're going to have two of them up there, you might as well
have three of them. I...I can't tell you that's good policy. That seems to be the trend that the Legislature has taken thus far. So at this point, I guess so that they are all on the same footing, that's what I'm ... that's the reason I'm probably going to pull my amendment to do it. I'd rather vote my amendment today, attach it, and go on. I don't think that's going to be possible.
SENATOR DIERKS: Thank you. You know, in retrospect, we put into effect a bill last year called 1114, and that, at that point in time, everybody looked on that as the way to provide property tax relief across the state of Nebraska, and it served its purpose, and those people who are affected by 1114, whether you're paying the property taxes or collecting them, have felt the purpose of that. They know what 1114 is doing to them, and they have told me to begin with they don't like it. It is hurting them. It's going to...it's going to close down government. It's going to call for consolidation of efforts, but now they're telling me we think we will be able to live with that, and one of the reasons they'll be able to live with that is because valuations are going to go up. That's just as sure as inflation comes along, so they'll be able to live with that for a little bit. But our purpose in providing 1114 was to provide property tax relief. Now all of a sudden we're coming along with these bills like (LB) 806 to put the hammer on them again, on those small schools, putting the hammer on people, when we ... when we go to giving relief for income tax, what we're saying then is, well, if we don't have enough money in our coffers because we've used this income tax as a rebate, now we're going to have to go back to those schools and counties and tell them to take more money out of property...
PRESIDENT ROBAK: One minute.
SENATOR DIERKS: ...taxes. So my estimation is that we need to leave 1114 alone, let it work, and forget about these other attacks on property taxes, and at least not do anything with income tax that's going to take away money that could be used for property tax relief, because that's been the problem from the very start. We got on 1114 because of the tax revolt going on out there, and we've addressed that with 1114. Let's just leave it alone. Thank you.
PRESIDENT ROBAK: Thank you, Senator. Senator Tyson announces that there are 17 third and fourth graders here from St. Leonard School in Madison. (Introduces teacher.) And they are seated in the north balcony. Will you all stand to be recognized, please. Welcome to the Legislature. Senator Beutler.
SENATOR BEUTLER: Madam Lieutenant Governor, members of the Legislature, again, I want to reiterate that I'm absolutely convinced that any income tax increase or decrease should not go beyond two years. And let me... lot me engage Senator Wehrbein in a conversation, if I may, Senator Wehrbein, because I want to ask you, if I can, and try to focus on that point in time that Senator Kristensen identified and which we've talked a little bit about before, that fiscal year when the school district levy has to be reduced from $1.10 to $1, and I think we're in pretty much agreement that somewhere over in the neighborhood of $70 million has to be produced at that point in time, if we intend to replace those revenues to the school districts.
SENATOR WEHRBEIN: When it goes from $1.10 to $1?
SENATOR BEUTLER: Right, when it goes from a $1.10 to a dollar.
SENATOR WEHRBEIN: Maybe someone else would know better, but that would (inaudible).
PRESIDENT ROBAK: Senator Wehrbein.
SENATOR WEHRBEIN: Yes, when it goes from a $1.10 to $1, you're saying that's $70 million additional...
SENATOR BEUTLER: Yeah.
SENATOR WEHRBEIN: ... money.
SENATOR BEUTLER: Assume that to be correct, for the moment.
SENATOR WEHRBEIN: Okay.
SENATOR BEUTLER: I think that's pretty close.
SENATOR WEHRBEIN: All right.
SENATOR BEUTLER: So at that point in time, we need to come up with $70 million. Now, at about that point in time, what do we have? If we look at the blue sheet, which is your best estimate of what will be out there four years from now, if you look in the lower righthand corner, there is the figure of minus $92 million approximately.
SENATOR WEHRBEIN: Yes.
SENATOR BEUTLER: All right, so we start out minus $92 million short, but we know that there is about 100 million there that's involved with (LB) 180 and duplicate, in a sense. So if we add that back in, we're at about 8 million. Now this doesn't account for any income tax cut. If we do the green sheet income tax cut, then we're somewhere at around, and the other minor factors, we're at somewhere around- a negative $200 million. Wouldn't that be more or less correct?
SENATOR WEHRBEIN: We could be in the out years, yes.
SENATOR BEUTLER: okay, minus $200 million, and even if we switched over $60 million from ... by not transferring it to reserve, we're still minus 140 million or somewhere in that neighborhood, isn't that more or less accurate?
SENATOR WEHRBEIN: That's right.
SENATOR BEUTLER: So, folks, I mean, there it is at a time when we are going to need to come up with $70 million, by the best estimates of the Appropriations Committee, we are $140 million short, and that's what I would like to hear us talk about more is exactly why are those figures wrong, if they're wrong. I don't think they are wrong. I think those do represent the Appropriations Committee's best estimates, and if that's the fact, we shouldn't even be thinking about a permanent income tax cut. If you need 70 million four years out, and your best estimates show you $140 million short, what can we be thinking of. And, Senator Wehrbein, I guess I would just ask you one question. You indicated in the spirit of looking at all these things advancing this to Select File, I guess my question is
this, if we did the very best we could with regard to the income tax cut, in terms of number of years, is there any way you could justify doing it beyond two years based upon the figures that we've developed?
SENATOR WEHRBEIN: Well,...
SENATOR BEUTLER: I mean, so I get to the point, you may not agree, but I get to the point, why advance this to Select File in a form that we all know is simply imprudent and impossible to do?
SENATOR WEHRBEIN: Well, I would...I could agree that I don't...I am not sure what that form will be.
PRESIDENT ROBAK: One minute.
SENATOR WEHRBEIN: My thought is, Senator Beutler, it probably much... is less than what is being proposed but it could be adjusted to where we could have the information. I am not clear at this point what will happen on Select with some other things, and I ... I was going to check. We ... you mentioned the 76 million, going from a $1.10 to...
SENATOR BEUTLER: Senator, I wanted to make one more point, and I don't have any time left, and everybody is talking, so I need that.
SENATOR WEHRBEIN: It's your time. I know it's your time.
SENATOR BEUTLER: I am sorry, but the last point I wanted to make, ladies... ladies and gentlemen, is simply this, we'll ... we're going to be $140 million short. If you cut out of the appropriations this year every bill on General and Select File, and did not pass them, with the exception of the 109 million for school aid, if you cut them all out and did the income tax cut, we would still not be positive in the year when we need to look for $70 million. You can cut out every bill, and it doesn't ... and it will not balance the figure.
PRESIDENT ROBAK: Time.
SENATOR BEUTLER: I would like to hear the discussion on that.
PRESIDENT ROBAK: Thank you, Senator Beutler. Senator Coordsen.
SENATOR COORDSEN: Thank you, Madam President, members of the body, and to a certain extent, Senator Beutler's concerns are my concerns, and I think shared by many, many people on the floor of the Legislature. However, I still believe it is more appropriate to keep this issue before and in the mix, before us and in the mix of proposals to provide the means of addressing what may be a continuing revenue surplus going into the future. The worse thing that can happen to us is certainly to spend too much money or to reduce tax rates, only to have to turn around and here in the floor of the Legislature try to raise tax rates in the future. You know the interesting thing about some of this debate is that you're never going to be raising tax rates in good times. The only time you're going to change, or going to feel you need to change either state sales tax rates or state income tax rates are when the economy goes south and there's not enough money coming into the coffers of the state to sustain the programs after you went through a series of what can be pretty gut-wrenching reductions. And so the public perception of a tax increase of any dimension at that point in time is much more difficult for the body to make, although it might have to be, it might be appropriate. I think it's much more acceptable to keep this in front of us now. I do believe that it needs to be time limiting, and that is in two years' time the end of the ... or the beginning of the second half of the next biennium the Legislature has to revisit it and see whether the income tax .rate reduction is Sustainable and reinstitute it at that time. To make it permanent as is currently proposed in -the committee amendments, via the Maurstad amendment, I think is probably the wrong thing to do. With a lot of talk been taken ... made about local control and local spending and all of that thing ... all of those things, I think it's important that we remember that much ... that we remember that much... that we remember that much of the local spending is brought about by requirements that we place upon local government creating a need for them or the demand for them to spend money, whether it's in schools for accreditation, whether it's in county government to comply with some sort of idea that we feel is good for the state and we put in place and mandate it upon all counties. Same thing applies
to municipalities. I rather suspect that if local government financed what they did by themselves we would have a completely different structure of local government. I do not know what that would be because we've been involved in the state aid trying to reduce property tax for more than 30 years and we can't get off of that wagon now as long as we're going along creating new mandates as we speak, quite frankly. Think you need to keep all your options open and to keep this bill in front of us. I certainly don't support the green copy form, I never have, but I think it's the better option for the Legislature to do. I much prefer the Kristensen amendment, I much prefer the committee amendments because those...
PRESIDENT ROBAK: One minute.
SENATOR COORDSEN: ... committee amendments were not taken out of a sack and shook out and sent out. We spent a large number of hours. We went through the same figures that the Appropriations Committee had available to them, looking at what the available resources might be going into the future. It was not an amendment that was made in haste. The Kristensen amendment is close to the original committee amendments and keeps some flexibility for future legislators for them to be able to provide the programs and assistance that the populace has come to believe that they need to have. Thank you, Madam President.
PRESIDENT ROBAK: Thank you, Senator Coordsen. Shortly the Pages will be carrying candy bars around to each of you. The candy bars are a gift from Speaker Withem and the reason and the message are obvious in the candy bar. Senator Schellpeper, your light is next.
SENATOR SCHELLPEPER: Thank you, Madam Chairman and members. I'm opposed to LB 401, I always have been. I don't think that we should be giving an income tax cut. And by moving the bill over to Select File I think we're getting in the same hole we dug with LB 806. We're taking away another round of debate on a bill that's very important to this body, especially the money involved. The most important issue in this state is property tax. I think last year when the Governor was out campaigning everybody kept telling him property tax is the issue. We
haven't done anything about it. LB 1114 would attempt to do that, but only if we put funding into education. That's the only way you're going to get any relief out there, because otherwise if you have to go back and raise property taxes to keep your schools open you haven't gained a thing. We have some additional revenue right now in this state. I think it's very important that we make sure that all of our schools are properly funded. What's the most important issue in this state? Is it to give income tax back to some wealthy people, or to fund education for children? It shouldn't be any contest. Should naturally be to fund education. That's what we need to put the money at. Schools, if we have to keep them all, hold them all harmless, let's do it. That's property tax relief. If it. takes 120-130 million, we have it. Let's do that. We don't need any income tax cut. Nobody's going to leave this state because the taxes are too high. Property taxes is the big problem. Now if you're going to... if you're... if this body is very insistent that we have to cut some form of a tax, I think that Senator Janssen's sales tax probably is a lot more fairer way to go. Everybody pays sales tax no matter what you buy. The higher income, the more things you buy; the lower income, they say you don't spend quite so much but percentagewise you spend more. Everybody gets something back. A half-cent sales tax reduction would be about the same as a 5 percent income tax cut. Everybody gains. Now if this body is very insistent that we do it, that makes a lot more sense. Besides, then this body controls the sales tax, if we have to go back and increase it some time, than it does to have the income tax cut. Then it's controlled by the lobby and they won't let you raise it again. So I think it's very important that this body consider where the money's coming from, how it's going to be spent, but I don't want anybody to forget about education and property tax. And the only way you're going to have property tax is put more sales and income tax into local education. That's the number one issue out there with ... that makes property tax go up every year, is education. I wished there was some way that we could do like the other states do. They all have a higher sales and income tax rate to fund education. That's what this state needs to do. If our property taxes were lowered 15-20 percent that'd do more for this economy than any income tax could ever consider doing, 'cause then everybody would have money. That's very important that we do that. We have the money. Let's not give it away.
I'm opposed to moving this bill over to Select File...
PRESIDENT ROBAK: One minute.
SENATOR SCHELLPEPER: ... at this time. I think we have the money, let's keep it here and let's talk about this bill on General File if it takes eight hours or whatever it takes, but let's get it in a form that is acceptable to this body right now. Let's not move it over. Thank you, Madam.
PRESIDENT ROBAK: Thank you, Senator. Senator Dwite Pedersen.
SENATOR Dw. PEDERSEN: Madam Lieutenant Governor, members of the Legislature, doesn't this candy bar say it all--Crunch? That's why we're doing this. Obviously, we're moving again under a crunch. I think it's a horrible way to make law and policy, but we're going to do it. Just got a message from a constituent of mine in Elkhorn. It says, you know, you spend money down there real fast, but when it comes to giving a cut it just squeezes by. And it did just squeeze by with 25 votes. My bottom line in this is the 5.5 percent cut in income tax 'cause we need it. We've got it. We took it from the people. We need to give it back to them. And we've got to do something permanently. We talk about cutting, we talk about cutting, we take a few of the working people on the bottom, we cut them, but we add two or three more, whether it be a position of administration, or if it be a ... need another clerk here or another person there, and that adds to this number that the people look at and say, the state has more employees every year. And this is the first time something's come along that looks like we have some extra that we can do with. Let's give it back to the people who gave. Arid the 5.5 percent increase is where I ... where I come down as going to support. We need to give it back. I know Senator Schellpeper was saying some things about the, you know, the property tax. I know the property tax, whether it be in 806 that we're making up part of that, the people want property tax cuts. But, you know, the property tax, I would love to see my property tax cut. I don't know, as I've looked at it and I'm sure some of you have, whether or not the Legislature's going to be able to cut property tax. Yes, we passed 1114, but we still have elected school boards, elected county commissioners, elected city councilmen who are out there spending that money.
The local government, more local control and them people, the same elected officials that the people are electing in the city offices, the county offices, the school boards are the people who keep calling back and say, hey, we need you to make up some of this. So as far as property tax goes, I wonder, you know, what we're going to be able to do. But I know this in reading the numbers, and I'm no tax expert, but I can see that we have enough money and things are looking good that we need to give back what we've got, and that 5.5 percent is my bottom line that ... where I'm going to support. Thank you.
PRESIDENT ROBAK: Thank you, Senator Pedersen. Senator Tyson.
SENATOR TYSON: Thank you, Madam President, members of the body. I think what we're seeing here today is something that we're going to see every year for the next 150 years, or until we go to the root of the problem and get a clear idea in our own minds what it is we're doing down here. We are taxing income in one form or the other. Property tax is the long, hard way to do that. But the immediate problem, LB 401, I'm in support of the Maurstad amendment. I think we have to have an income tax. I think it has to be permanent, and if you'll reflect for a moment you'll think that people plan what's going to impact on them. If they know that they're going to pay a tax rate this year and next year or, pardon me, '98-99, and that a...then the magic moment, the sunset of the tax cut, is going to happen, they're going to plan accordingly and their plans are going to increase or diminish the income to the state raised by income tax. I think therefore that it's apparent that the tax has to be permanent. We are adjusting one way or the other the various amounts that we intend to raise, but what we're causing is people to delay decisions or push decisions ahead and they are going to seek to maximize their income net of Nebraska taxes. Along the same lines, Senator Vrtiska said that it was easy to cut taxes, hard to raise them. People would come down and raise hell. They should, because every time they do that they have the opportunity to make Us or whoever it is that they're speaking to justify their decisions, and we're down here to make decisions that we can Justify. I don't believe a sunset provision will work, as Senator Chambers might attest, because we were talking about a sunset provision all this morning and probably will be talking some more. I urge the members of this
body to think about the permanency of the tax cut and the fact that it's a common sense approach to it. And I would also take, in passing, Senator Schellpeper and Senator Janssen's approach on cutting sales tax, which I think, being the most regressive tax we have, is a proper way to go. A half-cent sales tax cut is about $80 million in one year. Thank you, Madam President.
PRESIDENT ROBAK: Thank you, Senator Tyson. Senator Will.
SENATOR WILL: Thank you, Madam President, members of the body. I rise in opposition to the Kristensen amendment to the committee amendments and, again, it's with the understanding, as Senator Kristensen stated and as I understand it, that at some point he will withdraw this amendment. The fact is that I believe that the green copy of the bill is the proper form to address at this point, to send that bill to Select File in that form. I supported the Maurstad amendment on General File. I believe that Senator Maurstad made a very good case for that amendment, but at this point I think there are a number of different approaches being taken by various people that are interested in this. I have not heard from many that are totally irrevocably opposed to an income tax reduction of some type. It's just the manner and the duration of that that has been ... that has been a question as we've discussed this today. I understand Senator Chambers has additional, at least one additional amendment up there that probably would...should be brought up this afternoon, and I appreciate Senator Kristensen bringing this amendment as a forum for discussion of an income tax cut. My position has been in committee and on the floor that we should have an income tax cut, it should be a cut in rates and it should be permanent. It should be something that if we decide, we collectively as a Legislature, that it's not sustainable, 3UBtainability's kind of become a catchword for this type of cut and for proposed spending increases for that matter, that if this type of cut would not be sustainable that we can then come back in future years and we can correct that. I think 'that, frankly, putting a sunset on a rate reduction is the wrong thing to do; that if we are going to reduce income tax rates we should take a look and see if we think it's reasonable to do and go ahead and do that, and that's what the Governor's proposed, it's what I've proposed the last several years, and I think it's something that we, as a Legislature, can do. We can
give money back to the taxpayers because we have an economy that is relatively robust, that has in fact exceeded expectations, as far as forecasting has gone over the last few years. And that is why when we take a look and people that are ... tend to be naysayers, I guess, on what are called the out years, which are several years down in the budgeting process, they tend to be people who are hanging their hat on current projections, and we know, experience has taught us, that those projections are just that--projections. They oftentimes bear no resemblance to the reality that ultimately comes along. And I'm not casting aspersion against any of our staff that developed those because it's a very nonprecise science, studying the economics of the state, what money .. going to be coming in, what expenditures are going to be made, what demands are going to be made upon us by the federal government. But, in essence, I think If we're going to make a commitment to cutting income tax rates, we should do that. We should cut them in a permanent fashion. We should not sunset them. And for that reason I oppose the Kristensen amendment. I would advocate discussing this amendment on Select File. I think there's been a robust discussion on General File already, but I would advocate at this point rejecting the Kristensen amendment, subsequently...
PRESIDENT ROBAK: One minute.
SENATOR WILL: ... voting down the committee amendment, and advancing the green copy of the bill and getting us back to square one for debate on Select File. With that, Madam President, I would advocate the rejection of the Kristensen amendment with the assumption that he is going to withdraw it anyway.
PRESIDENT ROBAK: Thank you, Senator Will. Senator Wesely, ,followed by Senators Maurstad, Beutler, and Crosby.
SENATOR WESELY: Thank you, Madam President, members. Evidently, Senator Maurstad had a few words about some of the figures I used earlier about the need for us to recognize that some of the good standing that we have on the budget is in part due to the fact that there have been savings in Health and Human Services. Let me point out for you, as I've passed around figures that indicate exactly what I'm talking about, the
projections that we based our original budget on, back last fall and again as we started this session, were based on projections that showed Medicaid, public assistance, and special education having significant increases, as they have in the past, and what we ... one of the reasons we have a $300 million surplus is because we were able to save money in Medicaid and public assistance and reduce the amount budgeted in those areas. We have not decreased the expenditures or decreased the funding for these areas. What we have done is cut the amount expected to be spent in these areas. We have done it because of Medicaid managed care; we have done it because of welfare reform; and we've done it in special education because of the changes that we've made in that area. We have savings that are significant. In Medicaid, the savings are projected to be 28-plus million dollars in '97-98 and almost $43 million in '98-99. In public assistance, the savings are about 33.3,000 in '97-98, and over 2 million in '98-99. And then special education is very significant, as well, with $9 million savings in '96-97, 22 million, almost, in '97-98, and 32 million, almost, over in '98-99. The point is, though Senator Maurstad may not recognize it or remember it from his work on Appropriations Committee, the fact is that the surplus, in part, comes from the savings in primarily Medicaid, public assistance, and special education. If you look at the other handout, which is from the budget report issued by the Appropriations Committee, it specifically mentions this fact that we have had a savings in those three entitlements, in particular, that have significantly helped us with the surplus that we have. Likewise, another handout that you'll be getting is from a December 18th report, again documenting the information that I'm sharing with you. The point is that part of the savings, part of the surplus, is due in fact to savings we've accrued through changes in public assistance in Medicaid and in special education. We, in turn, are underfunding a number of areas in Health and Human Services, and as people, particularly the World-Herald and others, pound on the concept of not spending more money, lets understand that we've underfunded a number of areas and we have made savings because of changes that this Legislature has provided leadership on. And we ought not to forget the fact that we need to reinvest in people and in the human infrastructure of this state and try to do what we can to help alleviate some of those long-standing concerns. In addition, I talked about the
underfunding that's occurred with deferred maintenance. We have hundreds of millions of dollars in backlogged building maintenance, that I think is a long-term investment the state needs to be making. So not only-do we invest in people, we invest in infrastructure in other ways and we ought not to lose that fact. Again, my concern is, by making a long-term income tax cut of the depth of which we've talked about, it injures and impairs our ability to meet the legitimate needs of the state of Nebraska, not only in Health and Human Service, but in other budgetary areas as well. And we have to understand the history involved. As I mentioned earlier that in '74 and '79, we increased- state aid and cut income taxes and, within a short period of time, ended up back in special sessions trying to make up for the losses that we suffered and for the deficits ...
SPEAKER WITHEM PRESIDING
SPEAKER WITHEM: One minute.
SENATOR WESEL Y: ... that we faced. Let's not repeat history by making the same mistake again. Let's understand that we can't make and keep these promises of doing everything for everybody, we've got to take a stand on what our priorities are. My priorities are property tax relief and not harming our schools through that and not harming our local services and not harming our state services that have been waiting for the opportunity to get caught up as we've held the line on the state budget. And the way we can accomplish that isn't by doing all of that plus an income tax cut. We've got to recognize the income tax cut jeopardizes some of these other priorities, and we have to place that, I believe, as a lower priority, not as the top priority, as the Governor has talked about. So again, I oppose the advancement of LB 401. 1 would support the Kristensen amendment, but I oppose LB 401. Thank you.
SPEAKER WITHEM: Senator Maurstad.
SENATOR MAURSTAD: Thank you, Mr. Speaker. And I appreciate Senator Wesely's explanation of his misstatement earlier that there were major cuts in the area of Health and Human Services in the budget this year. It's ... as I look at what he passed out, obviously, some of the changes that are a result of
measures that were taken were because the state cannot sustain a 15.1 percent increase in Medicaid spending for ever and ever and ever, nor a 7.6 percent increase in public assistance. So, we can't...it boils down to the old issue of spending and when do we spend enough and when do we grow state government to the point when these types of increases are considered major cuts in some people's vernacular. It's appropriate in the budget ... and I don't want to get too far off of the issue of income taxes, but if we're going to talk about BUstainability and we're going to talk about whether or not we can afford to do this, I guess we have to look a little bit at the budget. Of course, we do carry over this year approximately $76 million, which as the report indicates and I never said otherwise, part of that didn't occur because an overestimation in the area of some of the expenditures in Health and Human Services along with some other items. The thought, the prevalent thought, for most of the members that have visited with me as I have worked on the appropriation process through the course of this year is to use that 76 million for one-time capital expenditures that don't build to the base of our budget that we might not be able to sustain. And for those that wish to, you can go through the one-time capital expenditure items and come up with an amount of around $55 million that, in essence, that surplus of 76 million that we're going to carry over from the current biennium to the next biennium would relate to. I'm having drafted and I ... not drafted, prepared and hopefully it will be here on the floor to answer some of the questions that Senator Beutler posed relative to how does this work, a scenario or a status where we take out the 100 million that is in the status now, part of the 200 million for state aid to local government that no one that I've talked to expects. When we started the session, we were looking at $100 million, hopefully, at the beginning of the session, in additional state aid. Reduced that status 100 million and show the cost of the green copy of LB 401, the income tax, show the transfer ... the nontransfer, actually what it would be of maintaining the cash reserve, that savings account portion of our budget. Leaving that at 40 million and seeing what that does to the bottom line, given if, in fact, we were to pass every A bill that we have before us, I think ultimately we may have to make some decisions on some of the A bills. We may have to make some of the decisions on the overall spending in the budget. But it seems to, me that its
good public policy that we, in fact, don't continue to overtax the individuals in this state to support increased state spending. And so I hope that we're able to sustain an income tax reduction. I think it's an important part of our work that we're looking at for the balance of this session in addition to property tax relief, as many have expressed. I agree with that.
SPEAKER WITHEM: One minute.
SENATOR MAURSTAD: In addition to a heftier budget than I think we ought to be adopting, but that will be yet to be decided. It might end up a little slimmer than what it is now, but if that's the will of a majority of the Legislature, then that's the will. But I think that we can look to the out years and we can discuss this more in the future of just how those out years are developed. I agree that those out years should be used as a tool as we look at the circumstances in how we develop our budget and how we work our budget. But there's more to the budget. We're forgetting the aspect of this that there are many key state employees that work hard and managers that work hard to live within the means of this budget, and they're going to do what they need to do to make sure that we don't spend more than we bring in, we maintain the minimum reserve, and we're able to meet the obligations of our budget during this two year period, and then we can begin to work on those two years beyond, given the circumstances and the status at that point in time.
SPEAKER WITHEM: Time, Senator. Senator Beutler.
SENATOR BEUTLER: Senator Withem, members of the Legislature, Senator Maurstad, I truly do appreciate your focus on this and the presentation of information, and I wanted to describe a little bit perhaps the differences in our perspectives. You picked up the sheet I passed out to you and I hope everybody will look once again at this sheet, because I think this sheet is the best overall indication of what government is doing in Nebraska, the best indication that we have essentially. And when you looked at this, Senator Maurstad, you pointed out that with respect to state taxes that they had gone up overall on the average at 9 percent, which is accurate. But if you look at local taxes, and this sheet totals up state and local taxes, you'll see that they've increased at a rate that is below the
rate of inflation during that period of time. So what's been happening over time is that we have been addressing the property tax problem, slowly and in pieces, and to some extent I suppose that's an argument against further addressing the property tax problems except that we all still understand, with regard to property taxes, that we still have relative to all other states a very, very high reliance upon property taxes, notwithstanding the continual transfer over time of the burden from property to state sales and income taxes. But what I want to point out again and what I ... what I think this shows is that Nebraska government has been incredibly stable and constant, and I think that's one of the best recommendations for business that you can possibly have, is stability, is stability of government. And what do I mean by stability of government? Again I would like you to look at the chart and look at the percentages over on the right-hand side which show when you take state and local government altogether in Nebraska what percentage of personal income have we been using year out and year...year in and year out over the years from 1967 to 1995-96 fiscal year? And I think a comparison to personal income is the fairest comparison, because insofar as what the government takes is constant relative to what the private sector spends, it means that government has not been getting any bigger relative to the growth in the economy, and that's the major point. And if you look at this you'll see in the year 1967-68 that 11.41 percent of our economy, measured by personal income, was taken up with a combination of state and local taxes, 11.41 percent. If you go down the years, that fluctuates very little until you get down to '95-96, which is the last year we have here, and what is the percentage of personal income that's taken by government--11.21 percent, compared to 11.41 percent in 1967- 68. Government has been getting bigger, but it has not been getting bigger than the private sector. It has had a constant relationship throughout these years. And I just want to point that out once again because there seems to be this atmosphere brewing that there's overtaxation and that government is spending out of control again. We're not spending out of control. We have never spent out of control in this state, because we've had some very conservative leadership from people like Jerry Warner and the people on the Appropriations Committee in prior years and the people on the Appropriations Committee, frankly, this year. So I think we ought to keep all of that in
mind and have a stable, thoughtful attitude about what we're doing and look at the figures and ask ourselves should we be juggling rates now or should we be constant...
SPEAKER WITHEM: One minute.
SENATOR BEUTLER: ...and be sure we have the money in the year 2000 and 2001 to give the added measure of property tax reduction in the amount of $70 million that we promised with 1114 of last year. Thank you.
SPEAKER WITHEM: Senator Crosby.
SENATOR CROSBY: I waive off. Thank you.
SPEAKER WITHEM: Senator Will. I don't see Senator Will. Senator Kristensen. Senator Will has just made it by the ... whatever, I'm not sure what, but, Senator Will. Question has been called. Do I see five hands? I do not see any... I see two hands. I do not see the five hands for the purpose of calling.... I do see the five hands for purposes of calling the question. The question is, shall debate now cease on the pending Kristensen amendment? All of those in favor vote aye, opposed vote nay. Have you all voted on the motion to cease debate? Record.
ASSISTANT CLERK: 27 ayes, 1 nay to cease debate, Mr. President.
SPEAKER WITHEM: Debate is ceased. Senator Kristensen, to close.
SENATOR KRISTENSEN: Thank you, Mr. President, members of the Legislature. As you've seen for the last two hours, there's a variety of approaches to what to do in this session. The vote on the Maurstad amendment that we had last week is an indication that there's a sufficient number of people who want a cut. The discussion today points out that there is a sufficient amount of uncertainty as to what that cut will look like, the amount of the cut, in what form it will take place, and ultimately the timing of when it takes place. This is amount of risk. That's what this discussion is about. If you look at our sheet today, look at line 36 on your General Fund status sheet today, you
have $230 million. If you take LB 290 (sic) or 269 and our A bills, that amounts to $39 million; 180 sits there with $200 million in this biennium; LB 401 sits, an it is today right now at this point, with *7171 million. There is not room. You can hope that good times will continue, I don't think that they will. You can do the things that may well be politically expedient and that's to put in a cut and say we'll take care of it later, or you can begin to try to get to a point of what is good policy with a cut. I believe the amendment we passed last week was too much. We need to pare it back. We need to keep our options open and we need to recognize that everybody works off the minimum reserve. That's what gives you $230 million. If you work off the maximum reserve you only have $83 million and you barely can then fund the A bills and LB 269. So it's a matter of how much risk do you want to assume. From my point of view, I'd rather do the amendment I have up here, again, that's a 4 percent cut but for two years, and if the economy's good and if the times are good at that point in time you can vote to extend that cut. Under this amendment you have a personal exemption that continues on and so that's the permanency of that issue. I also changed the transfer of the Cash Fund, put half in this biennium, half the next, so when you have things like the $1 levy limit, which is the true levy limit that's going to come in for schools, not the $1.10, that's just the first one, you'll have a tremendous amount of pressure. I think it's apparent today that I'll not have the support to do this amendment today on General File, but I hope that on Select File that you can begin to look at how are you going to take care of that $230 million. And you can ignore it and let it go, you can spend it elsewhere, you can put it into the base, but I'll guarantee you that in two years you'll be back saying, what in the world happened to that $230 million and how are we ever going to get the money back to deal with what we really need to deal with? So with that, Mr. President, I'm glad that you had a child, I appreciate you passing out the candy bar to recognize that fact. It seems to be the pattern. My congratulations to Diane. With that, as I said in my opening, I'll pull the amendment. I know there will be other discussions. I cannot vote for the committee amendments the way they are. I plan to vote against them, but I plan to reoffer and would hope that we could file this amendment for Select File and would ask, request to do so. With that, I'd pull my amendment.
SPEAKER WITHEM: Amendment is withdrawn. Mr. Clerk, you have items for the record?
CLERK: I do, Mr. President. Senator Schimek, amendments to (LB) 764; Senator Wesely, (LB) 622; Senator Landis to (LB) 314; Senator Kristensen to (LB) 197; Senator Wehrbein, (LB) 388; and Senator Dwite Pedersen to (LB) 150. (See pages 1934-40 of the Legislative Journal.)
Mr. President, Senator Chambers would move to amend the committee amendments. (FA269 is found on page 1940 of the Legislative Journal.)
SPEAKER WITHEM: Senator Chambers, to open on your amendment.
SENATOR CHAMBERS: Mr. Speaker and members Of the Legislature, my amendment is to strike the Maurstad amendment. I know that we've heard a lot of conversation of bow everybody who is essential to an agreement have entered into that agreement and the committee amendments will be rejected. I don't count on that. I think we do things a step at a time. So the first thing we need to do is to put the committee amendments back in the form -they were in before the addition of the Maurstad amendment. So what my proposal is, is that we strike the Maurstad amendment. And I'm going to tell you all in advance what it is that I intend to do on this bill as I did on LB 216. I'm going to fight this bill. I don't think any form of LB 401 should pass, and I said that the other day when we first started talking about it. I said I don't like 401, 1 don't like the committee amendments, I don't like Senator Maurstad's amendment, so I'm against it in any form and I have to carry through on what it is that I say so that in all this confusion and chaos that we find in the Legislature there will be one reliable point of reference, one rock that has not chipped, one point of the compass that remains true, and with all due respect and in all modesty, I must say that I am the one to whom reference is being made. I'm not going anywhere. I think it's very nice when everybody feels good and collegial and everything is worked out, but, brothers and sisters, we're too far away from the end of the session for this. All this good cheer, it just sickens me, Senator Tyson. Now if this were the second day before the end
then maybe I'd feel a little differently, but we're starting to get along too well too soon, and I don't have time tonight to write another taunting, ridiculing poem, like I did against my rural colleagues who so stupidly, yeah, that's what I said, voted to pass LB 806 over the biggest hurdle. And I favor 806, I favor it, but it was not a wise thing to be done. One difference though; that bill had been debated and debated and debated. LB 401 has not even, to this moment, had what I consider substantial debate. The only thing that has been talked about here is a way to give a rationalization for not debating it as we should at this stage. Well, as you all know, I am impervious to agreements that others have made; I am impervious to the criticism from my colleagues; I am unmoved by people's anger, hostility or frustration. As a matter of fact, it just lets me know that I'm doing my job. When you all are too comfortable, it means that things are not being done in the way that they should be, and this bill is going to have to go to cloture to get a vote to move it without any amendments. Now I don't know if they got 33 votes. You never can tell what will happen around here. But I want "Gentle Ben" to know that it's not gentle Ernie over here. He can do everything he wants to and say whatever he wants to in the paper, but he hasn't talked to me, Senator Hillman. "Gentle Ben" has made his reckonings and done his calculating without considering me at all. So, since he disregards me and ignores me, obviously there's something in his trick bag that is going to neutralize me and remove me as an obstacle. I don't know what it is, but I want to be shown, I want to be taught, I want to be put in my place, and I want Ben to do it, and I'm talking about the Governor when I say that. He has all of this power. He can intimidate senators, but he can't intimidate me. He doesn't even talk to me. So why in the world, without him having shown me the essential requirement of moving this bill, should I agree to let it go? I do have respect for individual senators who participated in working out this arrangement, so what I'm saying is not to disparage them as individuals or as senators. I'm just saying they should have realized that my having expressed opposition to this bill means that I'm not going to just roll over and let that happen. They have done all that they realistically can do. That's to knock all these senators off their amendments. Tell them, "Senator A", take your amendments off immediately, if not sooner. "Senator A" stands up; well,
kind of shuffles his or her feet like little kids when they got cookie crumbs on their mouth and daddy or momma's mad 'cause somebody been in the cookie jar and shouldn't a been there, looks down at the floor and say, well, I want to withdraw my amendment. Fine. "Senator B". get your amendment off immediately or if not sooner. "Senator B": well, I guess I'll take mine off. One thing I can say about my good friend Senator Kristensen, he at least allowed there to be some discussion and right up to the last minute he sounded like he was going to -move his amendment. In fact, some of my colleagues over here started getting a little weak In the knees and they said, by God, he's going to go through with his amendment. I say, well, no, Senator Kristensen fights all the way to the end, and in case he dies in the process of giving this speech he wants it to appear that he died fighting the good fight. But he neither died nor left the amendment on. We knew that he would withdraw it. And here's what I do think; if you have been negotiating with people and you have given your word and there have been reciprocal promises, you should keep your word, no matter how ridiculous you might look out here on the floor when you come into the glare of the real world. You see, talent is developed in solitude, character in the stream of life. You can sit around and develop your ability to write, draw, paint or whatever in solitude. To develop character there has to be the pushing, the pulling, the opposition, the accommodations reached, or doing like Senator Wehrbein did in helping to put you all in the position you're all in this afternoon. He would not give me my $1,116,464, and now you shall pay. And that's what I said. Sin in haste; repent in leisure. Senator Wehrbein said he's prepared to let the session go, he has dug in his heels. And I said that I'm looking at these bills and I read them off on the agenda this morning; on this particular bill I'm not the only one with an agenda other than dealing only with whether or not there will be an income tax and how much. This is tied into a lot of things end probably more is at stake than I'm aware of, but what my amendment says is that we should strike the Maurstad amendment. Now I'm going to tell you what the Governor can do, Senator Tyson, and change... turn me around this afternoon, turn me around this afternoon, but we'd need a rule suspension to allow it. We don't allow people to come in to the Legislature and make comments. What he would have to do is walk over to this door, these two doors out here and we would have the
redcoats open the door. Then held have to crawl on his knees up to the front and then stand and held have to have a hat in his hand and I'd want him to twist that hat down small enough to put in his watch pocket, the way they used to make my people have to do. He'd have to ... couldn't look me in the eye, as we were not allowed to look people in the eye. And he'd have to apologize for all that he had done, all that he had ever thought about doing that offended me and, most of all, for having disregarded me in the way he has done. He has to acknowledge his arrogance and how unwise that was, promise that he'll never do it again, and then beg me to reconsider my position and please let his bill move to Select File. Then he has to crawl ...
SPEAKER WITHEM: One minute.
SENATOR CHAMBERS: ... crawl on out of here and we would have senators arranged like a gauntlet on each side of the aisle, and whoever wanted to take a shot at him with, you know, a jellybean or something, not anything that would hurt him, can do so. Now that seems to me to be a very reasonable trade. For him not to do that would be understood by me, but for him to deal with the Legislature in the way he is doing is, in effect, asking me to do what I said he'd have to do. He wants me to drop down on my knees and worship him and say, because he's the Governor and he can't get over the fact that Hagel kicked his rear end in the election and he's still smarting from it and can't get over it, so he's going to go out of here in a blaze of glory, then he needs to remember that I'm over here and I have to be contended with and I'll whoop him worse, figuratively speaking of course, than Hagel did. 'Cause he's still got to live in Nebraska, at least he doesn't have to look at Hagel every day. He got a house out there in Virginia or some ... wherever they meet out there.
SPEAKER WITHEM: Time, Senator.
SENATOR CHAMBERS: But I'm going to be here.
SPEAKER WITHEM: Would like to recognize, from Senator Schellpeper's district in Pierce, Nebraska, we have 25 seventh and eighth grade students from Zion Lutheran School in Pierce along with their sponsor. Could you please stand and be
recognized. Senator Maurstad.
SENATOR MAURSTAD: Point of order, Mr. Speaker. I'd like to rule on whether or not this amendment is in order as a result of it appears to be a reconsideration of an issue that was discussed and voted upon last week.
SPEAKER WITHEM: You are raising the point of order -that the Chambers' method is, In essence, a reconsideration. Is that your point?
SENATOR MAURSTAD: Yes, Mr. Speaker.
SPEAKER WITHEM: Senator Chambers, a point of order has been raised. I would allow you, as we do on a matter of germaneness, I would allow you the opportunity to comment prior to my ruling. The point is that the pending Chambers' amendment is, in essence, a reconsideration and, for that reason, I assume would not ... Senator Maurstad is raising the point that it would not be in order because it is in fact a reconsideration. Do you have a comment on that point?
SENATOR CHAMBERS: Yes. It is not a reconsideration. If it was to be a reconsideration I would have put a motion up there and said I move that we reconsider adoption of the Maurstad amendment. I'm not doing that. I'm just saying strike it and I think it's very clear what it is that I'm doing. And he might for, because of his pride in authorship, not want to see it go by the boards, but even if the Chair rules that it's a reconsideration, we're going to be on this bill anyway, but what you will allow Senator Maurstad to do is dictate the rest of the discussion on this bill. Now that should have no part to play in hew the Speaker rules, but if the Speaker rules that it's a reconsideration, I'm going to challenge the Speaker's ruling. And remember, we have many agendas afoot here this afternoon. We're not talking strictly about the rules. We're not talking strictly about a ruling by the Speaker. We are talking about the realistic situation that we're confronted with here. Senator Maurstad has a pride in ownership and I can understand it. He's not going to get many things done this session on this particular bill. Senator Maurstad, nobody is. If the bill doesn't go anywhere, nobody's going to get anything done.
You're going to lose your amendment anyway 'cause they're going to reject the committee amendments, that's what "hey said, so what difference does it make to you how it's done? You want to go down ... you want your little boat to be attached to the Titanic and sink with the Titanic instead of going down on your own, and that I can understand. But this is a motion to strike something that has been added to the committee amendments and I don't think it's a reconsideration. It is a motion to strike and a motion to strike is not a reconsideration. But the chair is at liberty, obviously, to rule as he sees fit. And I want them to mark well how they rule on this proposition, because I think the ruling that is given will probably be a precedent. If I decide that I want to reconsider something, Senator Maurstad, I will preserve that right by being not voting and I won't vote for something that I disagree with. But we will just see what the ruling is.
SPEAKER WITHEM: Senator Maurstad, I'm going to ask you to ... the body to stand at ease just a minute. I want to check something here in Mason's Manual to see if we can find a more ... an item on point here, so hold on a second. Senator Chambers, I'm ... and Senator Maurstad I guess is the person to whom I'm responding on your point of order, I do not find, either in Mason's, or in our rule book, a specific definition of what it means to reconsider, but in the context it appears to be when an action has been taken a body has an opportunity to reverse that action, appears to be the context in which the term "reconsider" appears. The impact of the ... we have taken an action on the matter May 7th, I believe. The effect of the Chambers' amendment would be to reverse that action already taken at the same stage of debate. That is, in essence, a reconsideration motion, so I would rule that this is, in its very nature, a reconsideration motion. We then get to the point of is it proper to be offered at this time and, for two reasons, it is not. Senator Chambers did not vote with the prevailing side, nor was he not voting on the measure. Secondly, our rule calls for a reconsideration motion to be made either the day or the day thereafter, and it no longer is, so I would rule that the motion is not in order because it is in essence a reconsideration. Senator Chambers.
SENATOR CHAMBERS: Mr. Speaker, I challenge the Chair.
SPEAKER WITHEM: You would be recognized. The motion now the I n is, shall the Chair be overruled on the ruling concerning the Chair has ruled that the current motion is not in order because it is in essence a reconsideration. Senator Chambers is making a motion to overrule the Chair. The effect of that motion would be to allow the motion to be taken up. The effect of sustaining the Chair would be to sustain that this is not a proper motion before us at this time. Our rules allow the motion to be made, they allow any member to speak one time to the motion. We'll then take a vote. The... it will require a majority of those present in order to overrule the Chair. I believe I, succinctly, as succinctly as I could, went through the process. Senator Chambers, you are recognized to open.
SENATOR CHAMBERS: Thank you, Mr. Speaker. Members of the Legislature, the Chair has given a ruling and the ruling could have gone either way as all such rulings could. Let's say that this bill had been before us three weeks ago and it come ' s up again today. Whenever anybody who had not voted on the prevailing side would make a motion to strike anything that had been added to the bill it would be deemed a reconsideration motion and it would be out of order. So if this is ruled out of order, all I need to do is get a copy of the Maurstad amendment and find a portion of it and move to strike that portion from the committee amendments, so I will still get the cat skinned, but I will do it in two or three steps instead of one. So that's why I don't care what the rule is in the book, I don't care what the ruling of the Speaker is or the President, whoever happens to be in the Chair at that time. If there's something that I want to get done, I'm going to find a way to get at it. I may not get the members to vote in the numbers that I want them to vote on it, but I'll get that issue before the body. So I just want you all to let this be a lesson for all of us. I have said, when we are messing around with the rules at the beginning of every session, I don't care what you do, what you put in the rule book, it will stop you before it stops me. His ruling would have stopped you all and you'd a said, well, that's right, it's a reconsideration. That ruling itself does not bother me, but I'm still going to move to overrule the Chair in the way that I'm doing and I'm going to be very frank about the whole thing, which is something that doesn't usually happen on the floor in a situation like this. I'm going to look at all
the votes that we take, and my saying that is going to make some of you vote against what I want because you want to show me that I cannot make you do anything, just as Senator Wehrbein showed me this morning that I can't make him do anything, and we're in the state we are in on this bill and we going to be in the condition we're going to be in on (LB) 890, the claims bill, whenever it comes up, and other bills that I decide to deal with. And I'm going to let you all keep showing me that I can't make you do anything, and we're going to stay on these bills and they're not going to go anywhere. As you show me and put me in my place, that's what you call throwing the baby out with the bathwater, or burning down the house, for whatever reason you have, when it's a house that you want to keep. We should vote to overrule the Chair. Then you can get a vote on striking Senator Maurstad's amendment. If you decide that you do not want to overrule the Chair, then you will make me do something, and I acknowledge it. You will make me have to use my pen and use a couple of pieces of paper out of my yellow pad and redraft my motion to strike, and I will be able to do that. And I would like Senator Maurstad, when I break up his amendment into parts, to say, well, Senator Chambers has already said what he's trying to do, so I think you ought to look at the fact that he wants to get rid of the whole thing and rule that this is a reconsideration too. And since the Chair said that it's ... any time we try to undo something the body has done, even if he tries to do it in step, in steps or pieces, then that's a reconsideration. And I don't care if that's the way the Chair rules, but I would expect the Chair to rule that way whenever he is in the Chair. I would expect -the Speaker to rule that way when he is in the Chair whenever an issue like this comes up. So I'm going to listen to what my colleagues say and if you decide to vote to uphold the Chair I'm not going to be offended at you. You could genuinely believe that the Chair is right in his ruling. Maybe under different circumstances I'd feel the same way. But we're in a battle here that goes beyond the reach of the rules and we all know that. So we can deal with Senator Maurstad's amendment on the motion that I have pending by overruling the Chair, or you can choose not to. Before any of you start having qualms about overruling the Chair for the reasons that I'm giving, I would like to remind you that that has been done before. When you wanted a certain thing to be done and the Chair ruled that the method being used was not in
accord with our rules, you simply voted to overrule the Chair. So now I'm being more direct than most people are when they make one of these motions. I am saying that in order to get at the vote on the motion as I have offered it, just overrule the Chair, but if you choose not to I'll take my lumps. And that constitutes my opening, Mr. Speaker, and I don't think I took my full ten minutes.
SPEAKER WITHEM: Senator Will, to speak on the motion to overrule the Chair.
SENATOR WILL: Thank you, Mr. Speaker, members of the body. I rise in support of the Chair and in opposition to the motion to overrule the Chair. I think the Speaker hit the nail on the head in saying that the crux of the matter is that we really don't have a fine-tuned definition of what reconsideration is, either in our rules or in Mason's Manual, which is referred to in our rules, which is a comprehensive book that provides guidance for legislative matters as far as procedure goes. I think that the Speaker is absolutely correct when he says that, in substance, this is a motion to reconsider and, as such, since Senator Chambers did not vote on the prevailing side, is not in order at this time, and is ... is properly ruled out of order by the Speaker. Senator Chambers is absolutely correct in that he can come with subsequent amendments that pick at different pieces of the Maurstad amendment, but the fact is this is a decision that the body made. The motion to strip the entire amendment is, in my opinion, simply a motion to reconsider in another guise, and should be correctly, and I believe the Speaker correctly ruled it out of order. The simple way to beat the Maurstad amendment, going to the substance of the issue, is simply to vote against the committee amendments. That's something that can be done easily. We can vote down the committee amendments and achieve exactly what Senator Chambers would like to do. Senator Chambers says it's too easy, and that may be, but sometimes ease is in the eye of the beholder and I would, frankly, urge the body to vote down the committee amendments, do what we were talking about two hours ago, which is to advance the green copy of the bill, and... and do that without going through the machinations that Senator Chambers would suggest by bringing an amendment to strike the Maurstad amendment. I think that's a lot cleaner way to do it. Let's
get the amendment out of the way. Let's vote down the Maurstad amendment... or vote down the committee amendments and advance the green copy of LB 401 and move this debate to Select File. That would be my suggestion. I would urge the body to uphold the Chair.
SPEAKER WITHEM: Senator Tyson.
SENATOR TYSON: Thank you, Mr. Speaker. I think... I really hate to stand here, Mr. Speaker and members of the body, and accuse a fellow senator of not being honest in what he is telling us, but I think we're very clear that Senator Chambers, who just said he was being frank about his intentions, was not telling the truth. He is being earnest about his intentions. 'There's a difference. Actually, what Senator Chambers is doing, and I rise in support of the ... of the Chair's ruling, Senator Chambers is after making this Chamber pay his time tax, which lie has alluded to a number of times, and I ... I feel that we should go along with this. If everybody here were to take his five minutes, we can then get to this and Senator Chambers, at that time, would have another seven hours to go. I think we should help him along with it. I ... I feel that everybody should speak on this, and then vote to support the Chair. Thank you, Mr. Chairman.
SPEAKER WITHEM: Senator Schellpeper.
SENATOR SCHELLPEPER: Yes, thank you, Mr. Speaker and members. I think if we're going to uphold the integrity of this body, we probably. would have to vote against the Chambers' reconsideration at this time. I think it's a much better process to go through the ... change the wording of an amendment just a little bit than it is to come and say we're going to overrule the Chair. I don't agree with the committee amendments or 401, so I think it's something that we need to consider but, when you look at this body and how we operate in here, I think it's very important that, at this time, that we not support the Chambers reconsideration, and let him come back, let Senator Chambers come back and put up some other motions to change it just a little bit. It will do the same purpose and I think it would keep the integrity just a little more. Thank you, Mr. Speaker.
SPEAKER WITHEM: Senator Maurstad on the motion to override ... overrule.
SENATOR MAURSTAD: Thank you, Mr. Speaker. I ... I rise to oppose the Chambers' motion and support the Chair. I think that the arguments for that have already been-laid Out, BO I would just ask my colleagues to vote no on the Chambers' amendment. Thank you, Mr. Speaker.
SPEAKER WITHEM: Senator Chambers, there are no further lights on. You would be recognized to close on the motion to overrule the Chair.
SENATOR CHAMBERS: Mr. Speaker and members of the Legislature, being frank and earnest, the Chair's ruling, based on the way the rule reads, was correct. There's no question in my mind about that. But I also told you that there have been times in the past when the Chair made a ruling which was in accord with what would be required under the rules, but the body wanted to pursue a certain course or achieve a certain end so they voted to overrule the Chair. So I had stated that's what I'm suggesting that we do. If you decide not to overrule the Chair, then in Senator Maurstad's amendment here, he adjusted these figures, these rates on page 2 of his amendment. The first one is down from .708 to .673. Well, I can just raise that to .707. He reduced .986 to .938, so I just raised that to .985, and just right on across the board. So if you decide to uphold the Chair, if you take a vote for conducting our affairs in accord with the rules, if you cast a vote in favor of backing the Chair when the Chair makes a ruling, in accord with the rules, then you don't offend me. But you raise a question in my mind, you caused me to question while on all these occasions in the past, you vote to overrule the Chair, or to uphold the Chair, when it suits your purposes even though -the ruling was not in accord not only with the rules but with prior rulings. We had one the other day, when a different person was in the Chair, and we were talking about the germaneness rule. We happen to have been on a bill and an amendment was being offered which the Governor wanted. I think the bill might have been (LB) 882. The Governor wanted the bill and the Governor wanted the amendment, so the motion ... or the amendment was ruled in order because it dealt with corrections. That was all you needed. That broad
subject matter, and that rendered any amendment that the Governor wanted germane. And I raised those issues then. The Speaker was not the one in the Chair at that time. I was arguing against the Chair's interpretation based on how the Speaker had ruled, a narrow construction, with which I disagree, but I felt that that should be what we could rely on. We cannot. So now you decide, if you vote to uphold the Chair, that you want to go back to the idea of following what you think the rules are. And again, it doesn't matter to me. It will simply show me that the Legislature is as unstable, unreliable, as I've always known it to be. And Senator Tyson, if I know it to be that way, how can I be surprised when it behaves the way I know it's going to behave? There would be something wrong with me, so however the Legislature votes is of no moment, but I'm curious to see how we're going to vote. And in order that we know how many are here...
SPEAKER WITHEM: One minute, Senator.
SENATOR CHAMBERS: ... and how many will have to vote against this wise ruling by the Chair, which, by the way, may not be followed in future rulings, I'm going to ask for a call of the house, and I would have to get one vote more than half of the number who are here, unless we have one of those breakdowns where I'd have to get more, and you'll see if that happens. But at any rate, I'm going to ask for a call of the house, then I would like a roll call vote.
SPEAKER WITHEM: The question before the body now then is, shall the house go under call? All of those in favor of the house going under call vote aye, opposed vote nay. Mr. Clerk, please record.
CLERK: 20 ayes, 2 nays to place the house under. call.
SPEAKER WITHEM: House is under call. Members, please return to the Chamber. If you are in the Chamber, make sure that you have --- recorded your presence. Unauthorized parties, please leave the floor. The house is under call. Senator Suttle and Senator Jones. All members not excused are present. Senator Chambers, there are 44 members who are present. It will take a vote by 23 to overrule the Chair. That is assuming we do not have more
arrivals prior to the conclusion of the vote. Mr. Clerk, a roll call vote has been requested. Please call the roll. The question is, shall the Chair be overruled? The Chair ruled that the current pending amendment is out of order because it is a reconsideration. Senator Chambers is asking that the Chair be overruled. Mr. Clerk, call the roll.
CLERK: (Roll call taken. See page 1941 of the Legislative Journal.) I aye, 39 nays, Mr. President, on the motion to overrule the Chair.
SPEAKER WITHEM: The motion to overrule the Chair is not successful. Call is raised. Mr. Clerk, next amendment.
CLERK: May I read some items, Mr. President?
SPEAKER WITHEM: Please read some items.
CLERK: Mr. President, amendments to be printed, Senator Kristenson, to 401; Senator Beutler, (LB) 495; Senator Wickersham, (LB) 806; Senator Kristensen to (LB) 269; Senator Chambers to (LB) 389; Senator Maurstad, 401. (See pages 1941-49 in the Legislative Journal.)
Mr. President, Enrollment and Review. Enrollment and Review reports LB 310, (LB) 310A and (LB) 517 as correctly engrossed. Enrollment and Review also reports LB 271 and (LB) 271A to Select File. And, Mr. President, study resolutions by Business and Labor (LR 131 and LR 132) will be referred to the Executive .Board. (See pages 1949-51 in the Legislative Journal.)
Mr. President, the next amendment to the committee amendments, Senator Chambers, FA270, Senator. (See page 1951 of the Legislative Journal.)
SPEAKER WITHEM: Senator Chambers , to open on your amendment.
SENATOR CHAMBERS: Mr. Speaker and members of the Legislature, I accept that last vote and I ... to be quite honest with you, that was the proper and appropriate vote, based on the ruling of the Chair. However, I do have a copy of Senator Maurstad's amendment, and I did alter one of the sets of figures. And
I ... that amendment I've put up there and that is different from Senator Maurstad's amendment, so it will not be a reconsideration, but the Chair can rule that it is because my ultimate goal is to deal with each one of those sets of figures and try to persuade you to change them. But anyway, I would deal with what's before us. In the committee amendment, the new language would be found in page 2 of the committee amendment in line 8. 1 would strike "years 1997 and 1998" and insert "year 1997." So instead of it reading "for tax years 1997 and 1998", it would read simply "for tax year 1997". 1 would like to ask Senator ... oh, although he's busy, I need to ask Senator Wickersham a question.
SPEAKER WITHEM: Senator Wickersham, could you respond to a question, please?
SENATOR WICKERSHAM: Excuse me, Senator, can I ...
SENATOR CHAMBERS: Senator Wickersham, here is my amendment if you look at the committee amendment, and I'll give you time to find it, it would be ... the bill number is 401. He knows...
SENATOR WICKERSHAM: I think we have that part down, Senator.
SENATOR CHAMBERS: Okay. And I will ... I will give a comment or two while he finds the committee amendment, the bill. Instead of having two tax years, '97 and '98, mine would reduce it to one and that would be 197. Here is my amendment, Senator Wickersham. I would strike the words in line 8, "years 1997 and 1998" and I would insert "year 1997" so it would read, "for tax year 1997". And it would not include 1998.
SENATOR WICKERSHAM: Yes.
SENATOR CHAMBERS: So what would be the effect ofthis amendment?
SENATOR WICKERSHAM: It makes the rate reduction a one-year rate reduction rather than a two-year rate reduction.
SENATOR CHAMBERS: Thank you. And that is exactly my intention if you adopt this amendment. If you take this amendment, you
have the opportunity to think about it, after one year. See how it goes, see how the public likes it, if they like you fattening their pocketbook for a year. And then if they say, I don't like this, I don't even need this, then put the rate back where it is supposed to be, not by doing anything, not by doing anything. Just let, by operation of law, things come back to where they were before that blunder was made for the one year, and anybody can be excused for making a mistake, for one year. I think this whole approach is wrong because we are basing it on a miscalculation. We're basing it on an admitted miscalculation. This psychic forecasting board made a miscalculation of over $31 million. Everybody is so elated that they want to build a program of how the state is going to operate on a miscalculation. This is not just pennies from heaven. Senator Tyson, we're talking about millions of dollars just raining down upon us like manna from heaven. I can't read your lips, so you're going to have to turn on your light and say it so we can all hear it. Now what they are eager to do, and the reason I can only say they, I'm not sure who all the players are on any one of these proposals. I would not have believed that there were 25 votes here to adopt Senator Maurstad's amendment. And I don't believe they were here, but I believe the Governor got busy. At any rate, what I am trying to do with this amendment is limit the damage to one year, and because the Legislature tends not to be very strong, they should be capable of not doing anything at all, so they would just wait it out and the damage would correct itself. This, I think is as rational an approach as anything that I've heard while dealing with what, to me, is an. irrational proposal. If there is the belief that this money that is available to the state, and they take into consideration the gross miscalculation by the physic forecasting board, if they believe that this is going to go on and on indefinitely, then I would say that there is a tremendous amount of wishful thinking at play. If we come back to reality after one year, things can be like they were and as they should have remained until more information on the subject were available to us than we have now. I would like to ask Senator Tyson a question.
SPEAKER WITHEM: Senator Tyson, will you respond?
SENATOR TYSON: Yes.
SENATOR CHAMBERS: Senator Tyson, I don't know if you could lay out each one of the proposals, and I'm not sure that I could, but have you heard any proposal suggested by LB 401 with which you agree?
SENATOR TYSON: I agree with the committee amendments, more properly the Maurstad amendment, of which I am a cosponsor.
SENATOR CHAMBERS: You cosponsored the Maurstad amendment?
SENATOR TYSON: Yes, sir, I did.
SENATOR CHAMBERS: But you don't really agree with that as much as you do the committee amendments, so that I can understand. Is that true?
SENATOR TYSON: No, I agree with the Maurstad amendment to the committee amendments.
SENATOR CHAMBERS: All right. Now if the Maurstad amendment is not connected to the committee amendment, would you agree and...with and support the committee amendment?
SENATOR TYSON: No.
SENATOR CHAMBERS: Do you agree with LB 401 without either the committee amendment or the Maurstad amendment?
SENATOR TYSON: No.
SENATOR CHAMBERS: Then, if they strike the committee amendment, you're not going to support moving LB 401?
SENATOR TYSON: That's right.
SENATOR CHAMBERS: Oh, well sit down and take your Beat. That'd be like trying to break down an open door. I haven't been... I haven't been following what Senator Tyson has been doing carefully enough, so let me look around this room. Senator Vrtiska, you engaged me in some discussion this morning on LB 216. I'd like to ask you a couple of questions on this bill, and they are not going to be technical.
SPEAKER WITHEM: Senator Vrtiska, would you respond?.
SENATOR VRTISKA: Yes, I will if they're not too technical.
SENATOR CHAMBERS: Senator Vrtiska, do you agree with LB 401 in the green copy?
SENATOR VRTISKA: Well, a version of it, yes.
SENATOR CHAMBERS: No, no. I'm talking about the version, LB 401 as it appears in the green copy.
SENATOR VRTISKA: Well, it appeared to me it's probably going to have some more discussion, and I would... if you would have asked me if I would vote to move the bill, yes.
SENATOR CHAMBERS: In the green copy?
SENATOR VRTISKA: Yes.
SENATOR CHAMBERS: And would you support it on Final Reading, if it stays in the form it's in, in the green copy?
SENATOR VRTISKA: Probably not.
SENATOR CHAMBERS: Would you support it on Final Reading, if it were amended the way the committee amendments would do?
SENATOR VRTISKA: No, I don't think so.
SENATOR CHAMBERS: Would you amend ... would you support it if it were amended the way the committee amendments do plus ...
SPEAKER WITHEM: One minute.
SENATOR CHAMBERS: ... the Maurstad amendment?
SENATOR VRTISKA: No.
SENATOR CHAMBERS: Well, (laugh) how can you support it on Final Reading then? What form...
SENATOR VRTISKA: I didn't say I'd support it on Final Reading, Senator. I said I would support to move it to Final Reading, but I didn't...
SENATOR CHAMBERS: Oh, but not ... you would ... you wouldn't vote for it on Final Reading?
SENATOR VRTISKA: No.
SENATOR CHAMBERS: Then why would you move it over there?
SENATOR VRTISKA: Well, just because I ... well, I'm not... I'm not going to say I would. I ... I guess what I said was I would like to see some more discussion on some of the issues and maybe some amendments brought forth that might make it more palatable.
SENATOR CHAMBERS: I understand that, what you're saying now, but in the current form, you would not support it...
SENATOR VRTISKA: No.
SENATOR CHAMBERS: ... on Final Reading.
SENATOR VRTISKA: No, I wouldn't.
SENATOR CHAMBERS: Okay, thank you.
SPEAKER WITHEM: Senator Chambers, yours is the first light on, if you care to continue.
SENATOR CHAMBERS: Yes, I would. Members of the Legislature, I don't know if I can find anybody in here who supports the green copy, so let me see who cosponsored it, who introduced it. Oh, Senator Will, you're on it now. Senator Will, do you support the green copy?
SPEAKER WITHEM: Senator Will, can you respond?
SENATOR WILL: Yes, I would respond and, yes, Senator Chambers, I do.
SENATOR CHAMBERS: So then you'd be opposed to the committee amendments anyway?
SENATOR WILL: Yes.
SENATOR CHAMBERS: And you would be opposed to the committee amendments as amended by Senator Maurstad's amendment?
SENATOR WILL: I find Senator Maurstad's amendment better than the committee amendments but, at this point, my preference would be to vote down the amendments and advance the green copy.
SENATOR CHAMBERS: And then you would want to amend the green copy by attaching only the Maurstad amendment?
SENATOR WILL: If ... at this point, that's the most palatable alternative to the green copy, as far as I'm concerned.
SENATOR CHAMBERS: And then with the attachment of the Maurstad amendment, you would vote for LB 401 on Final Reading?
SENATOR WILL: Yes, I would.
SENATOR CHAMBERS: Even with the rich man's tax on the ... tax break on it ... tax cut on it?
SENATOR WILL: At this point, I think LB 401, with the Maurstad amendment, is a... is a reasonable approach, given the revenue projections that we have.
SENATOR CHAMBERS: Thank you, Senator Will. Oh, here's a question I'm going to ask you. If these amendments are rejected, the committee amendments, Senator Maurstad's amendment, and you vote to advance LB 401, are you going to offer any amendments yourself to 401 when it gets to Select File?
SENATOR WILL: At this point, I'm not planning to, but a number of us who are interested in having some type of income tax cut have had discussions about the possibility of sitting down and talking about different approaches we might have other than the green copy. So personally, at this point, as we speak today at
4:38 on May 13, 1 don't plan on introducing any amendments, but that could change.
SENATOR CHAMBERS: In the discussions you had with whomever you were discussing it, I'm not asking for names, was the discussion considering reducing the rate that Senator Maurstad suggested, was that part of the discussion?
SENATOR WILL: That ... there had ... there were a number of different options that came up, Senator Chambers. There was ... there have, been discussions about reducing the ... decreasing the rate if that...
SENATOR CHAMBERS: Uh-huh. Yes.
SENATOR WILL: Is that what you were saying?
SENATOR CHAMBERS: Yes, decreasing the rate.
SENATOR WILL: Yes, that ... that's one option that came up, some mix of that with ... with a personal exemption increase that... that is embodied in the Maurstad amendment now, and some other options as well, talking about putting sunsets on either the rate decrease, the exemption increase, or both.
SENATOR CHAMBERS: And where would the sunset be, two years out, three years, twenty?
SENATOR WILL: Two ... two years out.
SENATOR CHAMBERS: Well, the committee amendment, how far out is the sunset on the committee amendment? Isn't -that... is that two years?
SENATOR WILL: I believe so.
SENATOR CHAMBERS: So that they're the same on?
SENATOR WILL: Right.
SENATOR CHAMBERS: So it's only the rate, and that exemption credit?
SENATOR WILL: The rate is the main difference. There are a couple other differences in the Maurstad amendment, but the main difference is the rate. The Maurstad amendment has a larger rate decrease than the committee amendment.
SENATOR CHAMBERS: Which category of taxpayers will benefit the most under the Maurstad amendment, those ... the big shots or the little shots?
SENATOR WILL: The ... well, the...I don't know if I'd characterize them as big shots or little shots, but the...
SENATOR CHAMBERS: Okay, the big wheels and the little wheels.
SENATOR WILL: Well, big or little, there would be a decrease across the board. Probably if you ... dollar for dollar, those with higher incomes probably would benefit more from the Maurstad amendment...
SPEAKER WITHEM: One minute.
SENATOR WILL: ...as currently structured. And you may want to ask Senator Maurstad what his opinion of that is.
SENATOR CHAMBERS: No, no. I heard him the other day. We ... and the Legislature is more familiar and comfortable with giving bigger breaks to the big shots or the big wheels than the little shots and the little wheels, isn't that correct, Just like we're doing on LB 271 with that new way of assessing motor vehicles?
SENATOR WILL: I am only 1/49th of the Legislature, Senator Chambers, so I can't speak for the Legislature as a whole. We could ... we could get into a lengthy debate as to who's benefited and who is not, from decisions that have been made over the years.
SENATOR CHAMBERS: Well, we can't right now because I think my minute is up, but I will continue this as the afternoon wears on.
SENATOR WILL: Okay.
SPEAKER WITHEM: Senator Chambers, yours is the next light.
SENATOR CHAMBERS: Yes, we'll continue it now. Senator Will, you're familiar with LB 271, aren't you?
SENATOR WILL: Yes.
SENATOR CHAMBERS: And everybody has acknowledged that those who buy these luxury cars and trade them off regularly are going to gain the most from that legislation.
SENATOR WILL: Was that a question?
SENATOR CHAMBERS: Are you... are you aware of that?
SENATOR WILL: I ... that's my belief.
SENATOR CHAMBERS: Okay, and the Legislature feels very comfortable doing that?,
SENATOR WILL: Uh, I don't know.
SENATOR CHAMBERS: Well, what have they done with the bill?
SENATOR WILL: They've advanced it at this point.
SENATOR CHAMBERS: That means they're comfortable with it, doesn't it? Or does that mean they oppose it? They show their opposition to a bill by advancing it?
SENATOR WILL: No, I wouldn't put it that way. I don't know.
SENATOR CHAMBERS: Maybe our rural colleagues do, but I meant those of us who are sane and sensible in... from the big city.
SENATOR WILL: Senator Chambers, as you recall, I opposed that bill.
SENATOR CHAMBERS: Thank you. Thank you, Senator Will. Members of the Legislature, what my amendment would do is amend the committee amendments, and I can see now, Senator Tyson, they're
getting awfully cagey around here. They're not going to talk to me while I attempt to amend the committee amendments. But while they're talking about my amendments to the committee amendments, I'm looking at LB 401. See, LB 401 not only contains new language, it contains old language. Unless LB... oh, yes, I see some of the changes in LB 401, the original one. Okay, so there's plenty to work with there. They don't think that I can stay here -very long, but I think I'm going to have to show that I can. And the main thing I'm trying to do today is not let this bill go anywhere. I don't know how many votes they have to move it. The reason I am offering the types of amendments that I am is because they might be engaged in serious negotiation, whoever they are, trying to determine what they might do if they get the bill to Select File. But I think there's a person in the Executive Office who wants this bill moved. It will bit an accomplishment, it will be a step in the right direction. If the bill comes to a vote, it probably will move, so I want to delay that as long as I can, and then I will vote against moving it. But unless there are others who feel the way that I do, it's a cinch that this bill will move this afternoon in the green copy form. Yet, nobody has said they support the bill in its present form. Even Senator Will who must be a cosponsor now said he likes the Maurstad amendment approach better than this green copy. It looks like ... oh, and here's Senator Wickersham coming back to his old haunts. He used to live over here before he deserted us. But unless somebody else is concerned about the bill in the way that I am, it may move today if the Speaker decides to keep us here till midnight. But at midnight I will have done all that one man can do. Well, I guess we wouldn't have to stay till midnight. If we just started now, we'd have to stay till around that time. But for the duration of whatever time remains, I'm going to be here.
SPEAKER WITHEM: One minute.
SENATOR CHAMBERS: But if there are people such as Senator Tyson and others, Senator Schellpeper over there... is Senator Schellpeper over there? No, he's not. If there are people such as Senator Jones over there who will give me some time, if there... Senator Tyson. Give me some time. Where's Senator Schellpeper? He spoke against this. Now you...I'll do the work, but give me some time. Senator Tyson, how about you?
Give me some time. We're going ... we got to stay here till eleven o'clock tonight, and I'm willing to do the work, but you got to give me some time. He's not going to give me any time. Senator Tyson, let me ask you a question.
SPEAKER WITHEM: Senator, your time is completed. Senator Beutler.
SENATOR BEUTLER: Senator Withem, members of the Legislature, I'm not sure if I understand perfectly what Senator Chambers is doing with the current amendment so it's not the current amendment that I want to speak to, although the general direction in which he is going, that is to say undoing the Maurstad amendment, would be good from my perspective for the reason that the Maurstad amendment has the unhappy aspect of being permanent in nature, and that therein, I think, lies the problem with what we have before us now, so I would be in favor of Senator Chambers' amendments, one by one, as they have the effect, or would have the effect, of eventually deleting the Maurstad amendment and getting us back to the committee amendment, which was a good amendment from my perspective, because it did have the cut limited to-two years, and I want to be clear that I'm not against an income tax cut, if it can be sustained and if we can do that which we promised to do with respect to property tax reductions, if we can do that first. If we could get to the place where the income tax cut was limited to two years, I also had an amendment that then would pertain, that related to Senator Coordsen's work and the work of others, in creating a personal property tax trust fund. And that amendment would essentially say that, at the end of the two-year period, when the income tax cut ended and the rates returned to the current rates, that the money that would be the revenues that would increase then by the return of the rates to the normal rate, that money would go into the trust fund in addition to the monies that would hopefully go in there this year so that in addition to the $100 million or thereabouts, whatever it is we're putting into the trust fund this year, if we use the trust fund mechanism, that we would have an additional $50,000 in there two years hence, to address the problem of additional reduction of property taxes, particularly with... as they pertain to the school districts, and then we would have in that fund at least in the area of $50 million to deal with the need for
replacement revenues that could be as high as 70 or 80 million dollars. So that would be, from my perspective, a kind of nice mix in terms of giving an income tax reduction and, at the same time, protecting and conservatively dealing with our need to have something in the bank for that $1.10 to $1 drop in... in the school levy. So I just wanted to point out to you that there are mechanisms available that the Revenue Committee has essentially already put into place that we could build on to and add to and...
SPEAKER WITHEM: One minute.
SENATOR BEUTLER: ... and make the income tax mechanism work if... if the income tax reduction is not permanent in nature. Thank you, Mr. Speaker.
SPEAKER WITHEM: Senator Jones.
SENATOR JONES: Mr. President and members of the body, I just want to make a few comments on 401. 1 have not supported the 5.5 and I would have supported the committee amendments at 3 with a two-year sunset of $20 credit, but I will not support moving the green copy on to Select File because I think we ought to deal with it here in this part of the bill. And I think that we should do that here in place of moving everything over to Select File, and even if we have to make some reductions in Senator Maurstad's amendment, we need to do something here before we move it on. So I'm in favor of holding it here until we see what happens. And with that, I think I'll give the rest of my time to Senator Chambers.
SPEAKER WITHEM: Senator, you're yielding your time to Senator Chambers? Senator Chambers.
SENATOR CHAMBERS: Thank you, Senator Jones. Mr. Speaker and members of the Legislature, there might be a way yet today to do something on this bill no that it doesn't go to.-Select File in its present form. And if what I was told can be done, what I would do is, pull my amendments and let that amendment be offered. I would refile mine after that amendment. And if that one is rejected, then I would continue as I am while we're on General File. It's not that I'm unwilling to allow anything to
be done with this bill. Quite the contrary, I am offended because nothing is to be done with this bill. That's what offends my sensibilities. When this bill was put on the agenda yesterday, you could do as I did and look in the Journal and see the types of proposals that were pending. Even if not one of them would totally satisfy a person, they were of the nature that would allow a thorough discussion of the issues that are involved in this bill. When everybody came in here and started pulling amendments, the only thing that I can do, because I've been working hard on other bills, is to start drafting amendments that would stop this Juggernaut, and I will do that. The rest of you won't. You don't like what you see happening, but you won't do anything to stop it, but I will put forth the effort. Then people like Senator Tyson, who I thought were as solid as the Rock of Gibraltar, will get tired before me. He hasn't been battling as long as I have today and he's ready to go home already. Now he's shaking his head, saying he's going to stay right here and he wouldn't give me any time. He wants .to have it both ways. But the point that I'm trying to get across is if there are people attempting to arrive at some kind of an accord so that 401 doesn't go over there in the present form, I think that's a responsible course to take, but I don't know whether that's actually being attempted. So I wanted to say on the microphone that I am willing to give way if they are willing to try to do something. But if they're not going to do anything, then I'm prepared to proceed in the manner that I am. And I will simply draft more amendments. Then I won't ask my good friend, my former good friend, Senator Tyson, to give me time.
SPEAKER WITHEM: One minute.
SENATOR CHAMBERS: He's still my friend , but he's not my good friend anymore. He's got to earn that status back. However, I am able to draft amendments. I'll change a date here, change a date there, alter one of the rate decreases, maybe I'll increase it above what the current rate is. But if it's necessary to do that, to continue the discussion, I will do it. And what I want my friend, Senator Tyson, to consider is if he had a bill confronting him that he opposed as much as I do, could he carry on the battle single-handedly? Well, he's acknowledging probably not. He took away my argument again. Where he would
be fortunate is if I felt the same way he did about the bill, then he wouldn't have to. Every now and then a word or two, every now and then give me some time.
SPEAKER WITHEM: Time, Senator. Senator Schmitt.
SENATOR SCHMITT: Yes, Mr. Speaker. I yield my time to Senator Chambers.
SPEAKER WITHEM: Senator Chambers.
SENATOR CHAMBERS: Thank you, Senator Schmitt. Members of the Legislature, let me remind all of you of something. There are people who watch our proceedings. They know that I'm battling to keep a bad tax cut bill from advancing. There are people out there, believe it or not, who don't like this bill. Not all of them see eye-to-eye with the Governor. Not all of them think that the Legislature should roll over and fold. So who do they see battling on behalf of the people? Me, the villain. I was... I was labeled that by Senator Wehrbein. The ogre, again labeled that by Senator Wehrbein. Satan, again labeled that by Senator Wehrbein who had said he would be here as long as I am, and I don't see hide nor hair of him right now, but I'm sure he's lurking around here someplace. We don't have to go through what we've gone through today. I am not the one who creates these situations. They are foisted upon me. If the body wants to behave responsibly, those amendments that were pending, in my opinion, would not have all been pulled, but I can understand the individual senators doing that. What I don't understand is the willingness for a majority of the legislators to vote to advance this bill in its original form. And maybe what I ought to just do is see whether or not a majority will do that, ask for a roll call vote and then let them face the public and explain why they gave them the impression they have done one thing on this income tax matter and then before the session is over even, change their mind and do it a different way. Again, since so many on the floor are interested and concerned about what the public thinks, and always are talking about keeping faith with the public, don't vote something as a body which misleads them, as to what the Legislature is doing and what the Legislature's intents are. Do you think that any story written by any reporter, given the amount of time his or paper will
allow, can make clear whatever it is that the deal is that's been struck? Do you think the public is going to read through an article like that and understand the maneuvering that is involved, even if it's presented to them? All they will do is look at the headline, "Governor's Tax Cut Bill Advances". They got a tax cut coming, they know that because the Legislature voted that way. And they will also remember somewhere that they saw a headline, as I did, where the Governor is saying that Senator Withem supports the idea. But they don't read the article to see what Senator Withem may have actually said in terms of not being as opposed to the idea as he was at first, and that he thinks that the issue ought to be considered by the entire body. All they see is what I said this morning. Senator Withem is now in the Governor's camp. He's been hitched to the Governor's wagon, and will pull this tax cut right on across the board and, when they check their paycheck next year as early as is possible, they're going to see some advantages based on what the Legislature did. Then we're going to argue and fuss and fight if this thing gets to Select File, and maybe I'll prevail over there and stop it altogether. Then they're going to be mad at you all for two reasons. First of all, you misled them by giving them the impression they've got this tax cut in the bag. Secondly, you all didn't stand up to me and stop me from stopping you. That's what's going to make them very angry, that you all let Chambers stop you from giving that tax cut...
SPEAKER WITHEM: One minute.
SENATOR CHAMBERS: ... that you promised them in 401. That's what they're going to see. That's how they will understand it, and that's the way they should understand it. That's exactly the way they should understand it, because it is my intention to stop it, and it's my intention to make us earn our money. it's my intention to keep us here, to keep us here, and I will do it. I think this issue of an income tax cut is serious enough and important enough for us to just stay here and battle it out, although you all don't have to battle. I'm the one doing it. I was on my feet all morning. I should be tired by now. I should be like Senator Tyson, ready to run out of here and go home and do whatever I do. But while I'm ... well, Senator Tyson, you sitting there with your legs crossed, reared all back in your chair, and not saying anything and kicked your feet up now,
you're not battling. You're just kind of a bystander and a spectator.
SPEAKER WITHEM: Time. The Chair would recognize Senator Schellpeper.
SENATOR SCHELLPEPER: Thank you, Mr. Speaker and members. I'm getting a lot of advice back here. I Just wanted to remind the body again that whatever we do with LB 401, whatever dollars that we ... we give back is going to come from education, the students of this state because I think if you look at the long run over the long several years, that we're going to need all these extra funds to fund education, and I think that's where this body needs to put the money. It's very seldom that this body has extra funds to put an issue like that and, once again LB 1114 was sold to this state as property tax relief, and it will be, but only ... only if this state will put some dollars into education. And that's one of the problems that I have with LB 806 because the schools that don't gain will have to raise property taxes in order to operate their schools, so it's not property tax for the entire state. If the state will put additional funding into (LB) 806 so that would make all schools whole, then it's no problem. Very seldom do we have additional revenue, and I think it looks like it's going to be here for several years, hopefully it will be. Economy, I think, is going to be down a little bit next year. I think some of the rural economy isn't going to be quite as good because the prices aren't going to be as good, the farmers receive, and I don't know whether that's going to carry over. It seems like eventually it gets over to the other segments of the economy too, but I think it's very important that we put at least $125 million to $150 million into education at this time. Then we also have to remember that LB 1114 is also going to affect small towns, cities, counties. I don't think we can operate and not give them some additional funding or pick up some additional services either. So it's very important that this body consider an income tax cut at this time, rather than to give it for education. I think education has to be our number one priority and then probably our cities and our counties. LB 1114 with counties isn't going to affect them as much as it is the cities, especially some of the rural towns. I have some rural towns in my area that have $1.60, $1.70 tax... or mill levy, and yet the
people say, well, what'll we do? Well, they're going to have to cut services, they're going to have to merge some things, and they're willing to do that, but can they do enough merging and enough consolidating that they can still operate? I don't know. We'll have to wait and see what happens there, but I think the state needs to be able to do some things. In LB 306, we had about $800,000 that would go to some of the...these smaller towns. We're going to, I think, attempt to put that funding into probably LB 269 because I think that bill will pass. LB 306 may not pass unless we work out some kind of a consolidation or, you know, work out something on the bill. So I think we'll eventually do that, too. But, once again, I think my time's about up, I just want the body to...
SPEAKER WITHEM: One minute.
SENATOR SCHELLPEPER: ... try to think about it and don't forget that income tax competes right directly with fundingfor education in this state, and I think education has to come first. Thank you.
SPEAKER WITHEM: Senator Wickersham.
SENATOR WICKERSHAM: Thank you, Mr. President. It is, as I've indicated earlier, still appropriate for us to consider an income ... an income reduction bill in this session, although I believe that our primary focus has to be on property tax relief. As I've indicated before, this state is 16th in the nation in our reliance on property taxes. We are only 27th, at least on a per capita basis, in our reliance on income taxes. Overall, if you examine our tax structure on a per capita basis, we are in the middle. It is only our reliance on property taxes that puts our system out of balance and, of course, the initiative with 1114 and the associated bills was to begin to address that imbalance. If, however, we are going to have excess revenues at the state level, and if we want to restrain the impetuous spending or wasteful spending, then it is appropriate that we, in effect, take dollars off the table and an income tax reduction will do that. And I don't make that remark about impetuous spending, indicating that I think that is what the Appropriations Committee has brought to us in the bills that are now before us. But certainly it is difficult to balance the
competing needs of state government and local government for additional property tax relief dollars and to still find room for an income tax reduction, but I do fundamentally believe that that can and should be done. The...the difficulty, however as always, is in the details, and I think earlier this afternoon Senator Withem set out what some of those details are, that we need to determine first of all if we do wish to have an income tax reduction; secondly, what shape that income tax reduction is going to be; whether that income tax reduction is going to be permanent or whether we are going to be able to reexamine the issue as the future develops for us. My personal preference is that we have a time-limited reduction. I think at the moment, quite frankly, anything else is not very responsible because history should be a powerful teacher to us that what we see in this year is certainly not what we're going to see in next year, and certainly not the third and fourth years out, and that we do need to be concerned about the effect of the third and fourth years. We cannot ignore them and should not ignore them, even if we wanted to. The issue of whether or not we can indeed reexamine an income tax cut two years from now is one that I'm satisfied that is well within the capacities of this body. I am more concerned that we will, in effect, overrun our ... what is reality if we are not careful, in this session. I have not been in this body when it has overrun reality, but we've heard others describe that, and if you want to look at the materials that the Appropriations Committee put together for us, you'll see years in which that occurred. In fact, you'll find one year in which we had 11.8 percent growth in revenues. That was followed by significant spending initiatives and then by significant budget problems after that where...
SPEAKER WITHEM: One minute.
SENATOR WICKERSHAM: ...considerable adjustments had to be made to the state operating funds, adjustments that were very painful to make and occasionally, I think, even more than painful because you simply ran into a start-stop type of arrangement and those start-stop spending or startstop. projects are not literally good for anyone. They're not ... they're not the way that we should seek to conduct the public business In the state of Nebraska. I am hopeful that, in some respects, we can resolve the differences we have over -the methodology and the
May 13, 1997 LB, 401
term of the income-reduction bill, as well as size it properly so that it can be fitted in and we meet the needs of the citizens of the state of Nebraska and we meet for both...
SPEAKER WITHEM: Senator, I'm sorry. Your time is up. Senator Chambers, you have spoken three times. Your light is on. I would recognize ... yours is the only light on. I would recognize you to close on your amendment.
SENATOR CHAMBERS: Thank you, Mr. Speaker. And to those who've been trying to work something out, after I close I will talk to you and tell you the way it seems that things are... are shaping up. If Senators Kristensen and Coordsen are anywhere where they can hear, I wish they'd come back to the floor. And if they don't, then the train might leave the station without them being passengers. This bill is going to be a bone of contention. I have made it clear, and I'm going to do it again, I don't like the green copy. I don't like the committee amendments. I don't like the Maurstad amendment. I don't like the idea of giving a tax cut, period. I think there are other and better things that can be done with this money, but if there's to be a cut in some tax, it should be in the sales tax. I will support a cut such as that. In the meantime, we are kind of stuck on General File with this bill. People that held discussions earlier and reached certain understandings, what I would remind them is that not all members of the Legislature were a part of that agreement. Circumstances change. When circumstances change, they alter cases. And since all of us are politicians and realists, we know that agreements that do not include everybody ,are very fragile and delicate ... delicately balanced. If nothing can be worked out that will show the public that we are handling this bill in a serious, responsible manner, then I can continue to do what it is that I'm doing, talk of how inappropriate I think our conduct is, and how we are not giving this bill the consideration it should have on General File. But it does appear that there are opposing camps, there will be some battling on General ... on Select File. I cannot support this bill in any form, but what I will agree to do, if certain changes can be made in this bill, and I'm not going to say what they are at this point; if certain changes can be made in this bill, it will be shown that we are not just throwing in the towel and doing what the Governor ordered us to do. I'm not
saying we should do away with that notion simply because it would hurt our feelings or our image, but I say that would be a misrepresentation to the public of what the circumstances are in our discussion and handling of this bill. The Legislature has to assert itself. There are amendments that can be made either to the committee amendments, and they then will be adopted, or, if the committee amendments are rejected, there are some changes that can be made in the green copy. But in no case...
SPEAKER WITHEM: One minute.
SENATOR CHAMBERS: ... will I fold my tent and steal away if what we're left with is the prospect of advancing LB 401 unchanged. So I hope that those who are engaging in the discussion can tell me something one way or the other. I do have additional amendments pending, and I can continue to discuss those amendments to give time to all of those who are trying to work something out. But I want them to let me know that they are working something out. For those of us who are marathoners, the frame of mind that we have determines everything. Even though we can run 26 miles and whatever small change yards remain, we have to set our mind so that we know that's what is before us. We don't want to be thinking that we're going to do a little...
SPEAKER WITHEM: Time, Senator.
SENATOR CHAMBERS: Okay.
SPEAKER WITHEM: You have heard the closing. The pending matter is the Chambers' amendment to the committee amendments. We are now voting on that matter. All of those in favor of adopting the pending Chambers' amendment vote aye, opposed vote nay.
SENATOR CHAMBERS: Mr. Speaker.
SPEAKER WITHEM: Senator Chambers, for what purpose?
SENATOR CHAMBERS: I would ask for a call of the house and a roll call vote.
SPEAKER WITHEM: The question before the body now is, shall the house go under call? All those in favor vote aye, opposed vote
nay. Record, Mr. Clerk.
CLERK: 10 ayes, 4 nays to place the house under call.
SPEAKER WITHEM: House is under call. Members, please record your presence. The house is under call. All members not currently excused should be in their seats. Unauthorized parties should, leave the floor. Senator Jensen, could you check in, please. Senator Cudaback, would you please check in. Senator Coordsen, the house is under call, and Senator Coordeen is here. Okay, as I ... as I understand it, Senator Chambers, you, have requested a roll call vote on your amendment. Mr. Clerk, would you please call the roll.
CLERK: (Roll call taken. See pages 1951-52 of the Legislative Journal.) 7 ayes, 25 nays on the amendment, Mr. President.
SPEAKER WITHEM: Amendment is not adopted. The call is raised. Mr. Clerk, next matter.
CLERK: May I read some things, Mr. President?
SPEAKER WITHEM: Yes, items for the record.
CLERK: I have a series of amendments from Senator Wesely to (LB) 798; Senator Stuhr, an amendment to (LB) 806; Senator Wesely, (LB) 138; Senator Don Pederson, (LB) 297; Senator Bromm,
(LB) 806; Senator Stuhr, to (LB) 806; and Senator Bromm, to (LB) 806. (See pages 1952-57 of the Legislative Journal.)
Mr. President, the ... Senator Chambers would move to amend the committee amendments. (See FA271 on page 1957 of the Legislative Journal.)
SPEAKER WITHEM: Senator Chambers, to open on your amendment.
SENATOR CHAMBERS: Mr. Speaker and members of the Legislature, this amendment would, instead of striking "1997," would strike "1998" as far as the only tax year that would be affected by the committee amendment. Instead of it taking effect for tax years 1997 and 1998, my amendment would strike years 1997 and 1998 and I would insert "year 1998" BO that the language on page 2 in
line 8 would read, "for tax year 1998". It would skip 1997 and be effective for 1998. This is one of several amendments that I've offered, and now there is not a discussion of the amendment just for the purpose of trying to persuade you to accept it. But it is designed to give the opportunity for people who are like-minded to come together and see if some accord can be reached which would garner enough support to change LB 401. My personal view is that it is not the right message to give to the public who will be affected by what we do, that LB 401, unchanged, represents the best thinking of the Legislature, or a majority of the legislators, and that's how they can interpret a vote to advance this or any other bill. We can do all of this talking that we have done, or that I've done and that you've listened to, and they are not going to follow all of that. They will look at what the vote was and they will know that by seeing whatever headline might appear in the paper, "Governor's Tax Cut Bill Moves Unchanged" or is advanced unchanged. So if they read enough of the article to see what that bill promises them, they will read what is in LB 401. But nobody has said that 401 in the green copy version is satisfactory and acceptable. So you are going to change it perhaps, and it way not pass at all. But if you change it, it's going to be something different from what the public was led to accept. The Governor has already given you you all's instructions. He said the first order of business is for you all to take care of his tax cut proposal, then you talk about what you're going to spend as a Legislature. He is the super legislator, and he dictates what this Legislature is going to do. He determines the programs to be funded. He determines the level of funding and the Legislature just goes along with it. That's what has been happening with the Appropriations' bills, and now we come to this one, and the Governor, based on what people can read in the paper, has stated what a high priority it is for him, and made it clear that he can control the Legislature. If we would move this bill today, without altering it, then the public is entitled to believe the picture that the Governor has painted, that he runs and rules the Legislature, and a bill that was supposedly so contentious, that had so many differing approaches, threatened or promised by various members of the Legislature, suddenly has no opposition, and all those legislators have taken cover. The Governor runs the Legislature. From the standpoint of the integrity of our branch, we should not do that. I don't want the appearance to
develop either that whenever we come to a hard spending measure, we're going to say, let's delay discussing it, but send it on to the next stage of debate and we'll handle it then. We're not able, psychologically, to grapple with it now, but somehow magically at a later date everything is going to be taken care of and we can handle it then. That is something which the Legislature on this bill ultimately may do. If there are 33 votes and nothing is worked out, a cloture motion will be successful. If you can't get 33 votes but you want to suspend the rules, you'd need 30 votes for that. And I believe the worst thing that the Legislature can do, and as I said earlier, you don't listen to me anyway so you won't listen to this either, but in my opinion the worst thing the Legislature can do is to show itself willing to suspend the rules, to advance the bill with no further debate and no amendments, a bill of this magnitude and significance. All of those agreements that had been reached earlier in the day have no validity on this floor. That agreement did not constitute the quoin of the realm. We are in a different situation, and the circumstances have changed. What wise people will do is conform their conduct to those changed circumstances. Now I have even changed my posture. Rather than saying that I will, under all circumstances, take this bill, which I don't like, to cloture, I have yielded more than anybody else. I have yielded already more than anybody else because I've declared myself willing to make a change. Others are trying, but they haven't stated exactly what it is we can expect to occur. I am going to continue with my discussion to give them time to do that. I see enough people working to arrive at something, and so far ... well, I should have been quiet. I'm looking at what Senator Matzke is, over here, doing. Unless you reside in the culture corner, you have no idea what sometimes one of us must contend with in order to try to present something to the Legislature on this microphone. But so that the record will be clear on what my amendment would do, at page 2 of the committee amendment, line 8, 1 would strike the terminology, "years 1997 and 1998" and I would insert "year 1998". There might be some who would really vote for this amendment because it would limit the impact of the committee amendment to one year, and that one year would be for 1998. So if you're interested in limiting the impact of 401, you could support this amendment, and automatically everything would come to an end by operation of LB 401, if you
adopt the amendment that I'm offering you. In the meantime, we must press forward and hope that some agreement can be reached. So while they're on their side of the aisle doing their work, I'll be on my side of the aisle doing my work and maybe we can meet somewhere in the middle and tell the rest of you that something has been agreed on. To be quite frank about it, and earnest, although I shouldn't concede that much to Senator Tyson who folded ... folded He is so tired and so lacking in energy, he couldn't even walk his little finger over to his light...
SENATOR CROSBY PRESIDING
SENATOR CROSBY: One minute.
SENATOR CHAMBERS: ... and push that button and give me some time. Now he's going to give himself a heart attack trying to prove something that doesn't need to be proved. But what I think we also have here this afternoon is a lesson in legislating. It is not an easy process. The more difficult and serious the issue, sometimes the more difficult it is for us to reach a point that we know we need to reach and that we desire to reach. But the difficulty cannot deter us, and it cannot prevent us from doing all of those things necessary to reach the goal, and that's what we're going to have the opportunity to do before this day is over. Before the sun sets, before we leave this Chamber, we are going to have behaved in a very...
SENATOR CROSBY: Time.
SENATOR CHAMBERS: ... responsible manner.
SENATOR CROSBY: Thank you, Senator Chambers. Senator Chambers, your light is next. Would you like to continue speaking?
SENATOR CHAMBERS: Yes, I think I need to. I'm going to yield my time to Senator Will.
SENATOR CROSBY: Senator Will.
SENATOR WILL: Madam President and members of the body, I rise in opposition to the Chambers' amendment. Again I think that what we need to do is take a couple of steps back and look at
exactly what it is we're talking about when we are ... when we're debating LB 401. This is a fundamental change, I think, in our ... in our tax system in that we are proposing to scale back income tax rates, and this is something that, in fact, is doable. As we've talked about in previous debate on General File, there are numerous reasons that this can and should be done. Number one, we have revenue in excess of what has been projected by the ... the folks that we have that do that job, both on the legislative side and on the administrative side. This is ... a year ago, we would not have dreamed that we would have the revenue surplus that we do right now and, because of that, simply from a philosophical point of view, the Legislature could afford to give some money back to the taxpayers because we've collected more than we need for the operations oil state government. And, by the original copy of LB 401, which I continue to support, what we do is we do just a flat out rate reduction that returns this money to the taxpayers in much the manner that it came in, and I continue to support 'that as a concept. What the...what the Revenue Committee did was come in with a little twist and that is that they added a credit into this mix and adjusted the rate reduction such that, in essence, the money that is coming in from the income tax would be altered as far as the taxpayers of the state go, with some shifts among the various taxpaying brackets. The fact of the matter is I continue to support simply straight out rate reduction, and as I've stated previously, I think what we need to do is just a straight out reduction because we are taking in too much money. If we want to tinker with the brackets, if we want to tinker with who the money is coming from, that certainly is a legitimate topic for debate, but I think that it ought to be something that is taken up at the beginning of the legislative session. It ought to be something that is introduced as an original bill, that comes about through the committee process, and not something that simply pops up as a committee amendment or as an amendment on the floor and, subsequently, is considered without what I would consider, at least, to be proper debate. The fact is, I continue to support the original LB, 401. But as we all know, what happened subsequent to the adoption of the committee amendment, the committee amendment came up on the floor for debate. It was considered. Senator Maurstad brought an amendment that basically combined elements of the committee amendment and of the original LB 401, and those elements
reflected the fact that our revenue forecast has grown even rosier than it was when LB 401 was advanced from committee. And that's where we are now, considering the ... the Maurstad amendment that was adopted to the committee amendments and, in fact, now constitutes the committee amendments. And we are ... we're sitting at a point where what we need to do is decide how we are going to proceed with the debate on LB 401. Frankly, I think the best...
SENATOR CROSBY: One minute.
SENATOR WILL: ... thing to do would be to strip the amendments that have been adopted and...and debate LB 401 in its pristine state, but the fact is that's probably not something it looks, at this point, at least that is going to occur. So I think what we need to do is we need to reach a point on General File where we can advance LB 401 in whatever fashion, and agree that there is going to be a debate that occurs on Select File. We've done this with a number of items this year, LB ... most notably LB 806, and I think that LB 401 ought to be put on ... on an even playing field with those measures that have been kicked over to Select File already. We are, obviously, reaching a point where time is of the essence as far as the legislative session goes. I think on any given day a majority of the people in the Legislature probably would vote for...
SENATOR CROSBY: Time.
SENATOR WILL: ... some reduction in the income tax.
SENATOR CROSBY: Senator Will, your light is next. Would you like to continue?
SENATOR WILL: I might as well. I don't know that many people are listening, but I think I'm serving a useful purpose at this point. I would... I would hope that we can reach some point on LB 401 which, where as I said, we can advance this bill. It can reach Select File and take its place among those items that are going to be discussed as the legislative session winds down, because I ... I don't think there is an individual on this floor that would disagree that a change in the income tax rate is a worthwhile thing to talk about. It's something that I know
Senator Witek is interested in and Senator Janssen as well. They both have expressed interest, and Senator Brown, all my colleagues that are on the floor currently are, obviously, interested in this debate, and it's something that we certainly need to come up with some sort of structure whereby we can guarantee the taxpayers in the state of Nebraska a return on their dollar when we, legitimately and actually, have collected beyond what we need to spend. At that point for any governmental entity, whether it be the state, the city, school district, or the county, whether we're talking property taxes, sales taxes and income taxes, at that point needs to take that money and give it back to the taxpayers, if indeed projections go beyond what we expected as far as tax collections go. 1, in fact, have had other proposals that would return taxes ... tax dollars in different... in a different manner, most notably the homestead exemption. And I think that's something that if vie... if we do decide that we are, for some reason incomprehensible to me, not giving this tax money back to the taxpayers in the form of an income tax reduction, we need to start looking at things like a general homestead exemption that is paid for by the state. And the homestead exemption would operate quite simply, an individual homeowner would be given a flat dollar amount of exemption. That money would come off the top of the value of their home. What I have proposed is a $10,000 homestead exemption where the taxpayer, for example, in a $50,000 home, a home valuated at $50,000 for property tax purposes, would have $10,000 taken right off the top of that valuation and, in essence, that would cut their property tax by 20 percent. And the money would not be lost to the local subdivisions that get that property tax money but, instead, would be made up by the state. The state would reimburse the city, the county and the school district that lost that money, so we'd be providing property tax relief for the homeowner while, at the same time, relieving...not hurting the local subdivisions at all. There are certainly other methods as well that can be used for tax relief. I have also proposed what amounts to a renter's property tax relief measure whereby the state would recognize that a certain amount of property taxes that are paid by landlords actually are transferred to renters. And there indeed would be a recognition in state law that the renters do pay those property taxes and that we would reimburse a renter through the income tax process for the amount of
property taxes paid. In essence, the bottom line becomes that we have before us a bill that would give back money to taxpayers that in fact has been collected over and above the amount that we need to run...
SENATOR CROSBY: One minute.
SENATOR WILL: ... state government. And there are a lot of worthwhile projects out there that people are looking at that we can use state dollars for and those projects will be discussed as the session progresses, and some of those will be approved, some will not be. But in the mix ought to be LB 401, the bill that would provide income tax relief for the taxpayers of the state of Nebraska because certainly we ask a lot of our taxpayers and I'd like to believe as an elected official that we do a lot for them as well. But when we get to the point where we are collecting more tax than we need to operate legitimately state government, we ought to find some mechanism to return those dollars. And I think LB 401 in some form is that mechanism and we can look at the committee amendments as they stand currently with the Maurstad amendment. We could look at the green copy. We could look at some combination of the two or we can look at another mix that has not yet been presented...
SENATOR CROSBY: Time.
SENATOR WILL: ... or that we've arrived at.
SENATOR CROSBY: Senator Chambers, your light is next.
SENATOR CHAMBERS: Madam President and members of the Legislature, this amendment that I'm offering serves only one purpose and that's to limit the impact of this bill to one year. One reason I don't like LB 401 or any version of it is because we don't have any certainty that the foundation of the bill and the approach that it's taking in any or all of its versions is going to be reliable and permanent. We don't know. This is like a house built on the sand. I don't believe there's a person on the floor of the Legislature nor could a member of the "Psychic Forecasting Board" assure us with certitude that the conditions of the state's finances today will be that way two years from now, four years from now or even next year. In fact,
has Senator Wehrbein left altogether after saying he's going to be here as long as I am? I wish Senator Wehrbein would come in so I could ask him a question, but I will ask a question of somebody on the Appropriations Committee who's ... oh, let me ask Senator Brown a question.
SENATOR CROSBY: Senator Brown, will you...
SENATOR CHAMBERS: Oh, Senator Chris Peterson, are you on the Appropriations Committee?
SENATOR C. PETERSON: No, I'm not.
SENATOR CHAMBERS: Oh, Senator Brown, I'd like to ask you a question.
SENATOR CROSBY: Senator Brown, will you yield for a question?
SENATOR BROWN: Yes.
SENATOR CHAMBERS: Senator Brown, do you think there's any way anybody, whether it's as a member of the Legislature with what information we have, or the group that I refer to as the "Psychic Forecasting Board", can assure us that the economy of the state will be as robust as they say it is one year from now?
SENATOR BROWN: Forecasting is based totally on past history and predictions and, no, there's no one that can tell you absolutely what's going to happen in the future.
SENATOR CHAMBERS: Thank you. And I agree with that 100 percent but I like to get confirmation before I proceed too far because that may not be accepted if I had stated it. A house built on a weak foundation cannot stand. A house built on the sand cannot stand. This is a house we're building on sand and it's a house built of sand. I'm opposed to it, any form of LB 401. And I am most upset by the way the Governor has injected himself into what the Legislature is doing to make it look like he is the one dictating what happens on the floor. But unfortunately, some things that have happened give the impression that that might be the way things are. So what we have to do before we leave here today is some responsible act and that responsible act is not to
adjourn. That night be what some people wish. And believe it or not, there are some things in Omaha that I deem very important that I had planned to do. But we're at that point now in our proceedings where what we're doing here takes priority. We've reached a point where let's say there are ten points of disagreement and agreement is reached on the tenth one, ninth one, eighth one, seventh one, sixth one, and we work right down to the most difficult one. And as always happens when two sides don't agree, you save the hardest part for last and the hardest part is being faced now. I cannot tell you what the outcome is because I'm not going to say which way it ought to come out. But we need to arrive at some...
SENATOR CROSBY: One minute.
SENATOR CHAMBERS: ... determination this evening and we can. If I were in charge, Senator Crosby, I would state the way it ought to come out, but I'm not going to do that. I'm just a mere one-fortyninth of the Legislature, as stated Senator Will earlier. Have I spoken twice on this already?
SENATOR CROSBY: Yes, you have. Thank you, Senator Chambers. Senator Withem.
SPEAKER WITHEM: Yes, Madam President and members of the body. It's pretty obvious there's some milling around going on and people are talking about different opportunities and options that we might have as far as trying to get to a vote to advance LB 401 today sometime. And I'm very supportive of, number one, getting to a vote to advance LB 401. 1 believe we need to do that. As I indicated, the remarks that Senator Chambers has quoted from the newspaper I've come to believe that we do need to do an income tax cut this year. I am relatively indifferent I guess as to whether it is a permanent tax increase (sic) or a one that's limited to two years. I shouldn't say indifferent. I'm yet to be convinced that there is a strong policy rationale for doing one over the other. I'm going to have to analyze the data a little more. And I am also needed to be convinced one way or the other on whether the credit approach or whether the rate increase ... or the rate decrease is the appropriate way to go. One thing I'm firm on, however, and that I will be very strongly committed on, I am not going to vote to advance a bill
that takes $171 million off the table for the biennium as the dollar sheet, the information I have shows, if we do both a credit and a rate reduction. I will not vote to do that. I will vote to advance a bill that has a $121 million decrease or something less than that as I see the numbers are if we would adopt the original committee amendment or the green copy of the bill I believe takes a little less than that off the table. I know that there are some people talking about perhaps and I'll make my statements now so I won't have to speak later, and I'm just talking about my own personal vote. I'm not talking about what ought to be done by the body in order to facilitate a process or what ought not to be voted ... done to facilitate a process. But I just simply will not... if the agreement by a group of senators is to put a limitation on, as I understand is a position Senator Chambers and Senator Beutler would like to see done, and by doing that to vote to adopt the committee amendments as they are now fashioned, I will not vote to do that. I will not vote to adopt the committee amendments because I do not believe that if we are going to keep the promise to the citizens that we've made for supporting the property tax reductions that we voted last year, I just do not believe we can afford the full $171 million that the current committee amendments would do. And we all draw our lines and that's where my line is going to be drawn on this, and I will not vote to adopt the $171 million income tax cut. And if that gets adopted to the bill, I will not vote to advance LB 401 in that particular fashion. What I would like to see us do is advance the green copy of the bill as I indicated prior to that. if that's not acceptable to people, if people want to see some type of a limitation in terms of the permanence of that cut, then I'd like to see the bill advance with a limitation in terms of the timing, adopt the Beutler amendment to the green copy of the bill and see that advance. That would be my particular preference. I am very concerned about headlines in the newspaper talking about Legislature advances a $171 million income tax over the biennium and then an expectation that we are going to reasonably limit that back with an amendment on Select File.
SENATOR CROSBY: One minute.
SPEAKER WITHEM: So part of my taking the floor at this time was
to do my part in the giving people an opportunity to visit with one another. But I thought I would say something hopefully half way meaningful in terms of my vote when I did that, and I hopefully have done so to indicate to you the nature of my vote on any pending compromise amendments that may come up in the next few minutes.
SENATOR CROSBY: Thank you, Senator Withem. Senator Brown.
SENATOR BROWN: Madam President, members of the Legislature, as a member of the Appropriations Committee, I am always very conservative in the way that I approach things. And I have been conservative about the issue of income tax since I've been here. But I think that there are two things that I would argue that you do when we have extra funds, and I do not believe that we should spend it just because we have it. In fact, I think that I've said on the floor more than once that it's the rate of growth that causes us problems and it's always been my concern that we don't do things just because we happen to have the money in terms of spending. But I think there are two things that I would argue for. one is deferred maintenance, making up for those things that we have chosen not to do in the past that are an investment in our infrastructure. I think that's very important and so I will be arguing that because we have money we do that. And I would also argue for income tax reduction because I think that part of the reason that we have the extra funds is because we've had a good economy and that income tax has been coming in at a very nice rate and now we need to return some of it. I support LB 401 absolutely. I supported the original green copy of the bill, but I also voted for the Maurstad amendment. I do believe that in order to effect the kind of economic development incentive which I think an income tax reduction is and I think it's the very best thing that we can do for an economic development plan, that it needs to be permanent. But I also agree with Senator Chambers in some of the things that he has said about who is making that decision. And I believe that we are the ones that will make the decision about an income tax cut, and so I do think that it's fairly important that we fashion something that is ours, that we can say clearly reflects the commitment of this body because we are the ones that ultimately decide on it. And I agree with Senator Chambers that I would prefer to see a headline in the paper that
talks about the Legislature's decision for a tax cut. But I also share some of Senator Withem's concerns about the size of that. I never felt that by virtue of voting for the Maurstad amendment that we were locked in stone. I just think that the rate decrease part of it is essential for the economic development impact. And it may be the perspective -that I bring because of the kind of a district that I represent. And, yes, an income tax cut would be very beneficial to my district. But part of it is because I understand that some of the people who live in my district are people who make jobs, who are trying to recruit people. I talk a lot to recruiters who talk about how difficult it is to get people to consider moving to Nebraska because of the income tax rate. Our taxes are all high and I understand that and I know that we are going to do something to deal with property taxes. It's a part of our commitment on 1114. But I don't think that we just assume that the spending side of it and I include...
SENATOR CROSBY: One minute.
SENATOR BROWN: ... spending on state aid in the spending side of it, the spending side of it should drive everything and that we should look at whether we should do an income tax cut based on how much is left over. I think it all has to be a part of the puzzle. But the recruiters that I talk to say that if there's one single thing that they hear about from people who are looking at the possibility of relocating to Nebraska it is the income tax rate. And so I believe that it is absolutely essential that we move forward with something in the area of LB 401, and I just hope that something is being worked out so that we can move forward. Thank you.
SENATOR CROSBY: Senator Hartnett.
SENATOR HARTNETT: Madam Chairman and members of the body, I feel left out. I'm not part of a group. We got this group here, this group back there. I'm just by myself. Oh, I could go up there with...what ... Senator Chambers, do you want some time? I got up to talk, let Senator Chambers have some time if he so desires. Thank you.
SENATOR CROSBY: Senator Chambers.
SENATOR CHAMBERS: Thank you, Senator Hartnett. And as we do these things, people begin to see that it's not the easiest thing in the world to carry on a discourse just on and on and on and on all day every day. But when it's done for the cause of the good of the institution, we'll find a way. I think Senator Withem made some very, very appropriate remarks. We don't and we should not give the impression -that we're going to do a lot more than we are likely to do. It would be better if our first act gave the impression that maybe we're going to be a little tight fisted then we can come up with something better than that. It seems that the hang-up relates to how much is going to be implicated in two approaches. One is to take the committee amendment with some modification. The other would be to take the green copy with some modification. The green copy would put a two-year limit on the time that this reduction would be in place. And I would like to see something done with a credit. Some people believe that would involve too much money. The feeling is that the modification in the committee amendment that others are willing to go for would involve too much money. So maybe we're not going to be able to do anything this evening. Earlier we had one large group on the north side of the room. Now if you look around, YOU Bee that the majority of senators have kind of gravitated toward the back of the Chamber, but you can still distinguish two distinct groups back there, then a few just kind of miscellaneous people standing around who don't seem to belong to either group but are trying to listen and pick up on what's happening. Then I see to my right, to my left in front two very, very wise individuals who have decided to just kind of observe and see how things are going to fall out. Then when I look in the front, I see ... you can't refer to a female as an elder statesman but an elder statesperson and one who could be an up and comer if she would just pay more attention to what I advise her on, but she doesn't listen. She doesn't pa y attention. But there is hope as long as she is alive. So that's kind of the way we have the Chamber laid out this evening. It shows that there are different methodologies that can be used in the legislative process. And at this point there still seems to be an effort made to reach some kind of an agreement. But if one is not reached, what I had hoped for probably will not happen this evening, but it's going to have to happen at some time or this bill is not going to move. If there
are as many divisions on the bill as we see on the floor in terms of the differing groups, there probably wouldn't be enough votes to do anything on this bill. I don't see 33 people in any of those groups...
SENATOR CROSBY. One minute.
SENATOR CHAMBERS: ... so cloture is out. I don't see 30 to suspend the rules to take a vote without any debate or amendments. I don't even know if I see 25. So we're going to have to decide on what we're going to decide on this evening. If the decision is that no decision can be reached, we probably ought to just pack it in after all. But if there are those willing to continue to try, I will continue to talk. If I don't get any additional time on this one because people are occupied, I will close when that time comes, take a vote on it, then take up the next amendment or Beek a reconsideration or something to give more time to those who want to continue trying to work this out.
SENATOR CROSBY: Thank you, Senator Chambers. Senator Hartnett, your light is next.
SENATOR HARTNETT: Madam Chairman, members of the body, Senator Beutler, could I ask you, are you busy?
SENATOR CROSBY: Senator Beutler, will you yield to a question?
SENATOR HARTNETT: I heard earlier on the... some talk about amendments that you have. Do you want to talk about your amendments that, proposed amendments?
SENATOR BEUTLER: Senator, I don't know if the discussion is exclusively about my proposed amendments, but it involves them to the extent that it involves the question of limiting any tax cut that we may advance to Select File to a period of two years. That being my principle interest, I had drafted two amendments. One would limit the Maurstad tax cut to a period of two years and did simply that to the Maurstad amendment. The other made the assumption that the committee amendments were not adopted and, therefore, the Maurstad amendment was not adopted. And then we'd proceed to address the bill as a whole and limit the
green copy of the bill to a two-year tax cut, all of which is designed to relate to my central concern that there be money there...
SENATOR HARTNETT: For the future.
SENATOR BEUTLER: ... a couple years in the future to deal with the drop from $1.10 to $1 in the property tax levy.
SENATOR HARTNETT: Thank you.
SENATOR CROSBY: Senator Hartnett.
SENATOR HARTNETT: Done.
SENATOR CROSBY: There are no further lights, Senator Chambers. Senator Chambers, you're here, all right. There are no further lights. I'll recognize you to close.
SENATOR CHAMBERS: Madam President and members of the Legislature, this is a difficult bill and it's really a difficult position for me to be in. Not only do I not like the bill, but I want to inject an element into it which is not being discussed by any of these groups and that's to provide for a half cent decrease in the state sales tax. That's something that I would want to see in the bill. And I don't want anybody to misunderstand what it is that I'm trying to do and the significance of it. This that I'm trying to do does not mean I'm changing my position to the bill, any form of it. But in order to let the Legislature do something, I will try to be somewhat collegial. That's all, pure and simple. But if the bill moves this evening and it gets to Select File, I will do everything I can to stop it altogether. I will, whatever that means. And if they don't have 33 votes to get cloture, that's it. Senator Withem had mentioned that on this bill there's a point at which he draws his line. Others apparently have come to the same conclusion. But there seems to be a willingness, Senator Tyson, as when you're writing or you're reading come kind of fictional account, the voluntary suspension of disbelief. You allow things to happen in the story that could never happen in reality in order that the story can move forward and progress ... or poetry, yes. One of the voluntary suspensions
of disbelief is to say that it's poetry in the first place. But at any rate, this is the point at which I voluntarily suspend my disbelief. And if enough senators can come together to agree on some form of the bill other than the green copy unchanged, then I will get out of the way and let them get their vote. After that, it's like, I don't know how many of you all saw that little Walt Disney movie, it was so long ago I don't even remember the whole story in detail, but it was "The Fox and the Hound". One time the hound may have done something ... the fox may have done something to save the hound and they became good friends as little bitty babies because they didn't know any-thing about the world of the fox and the hounds. And this wise old owl, whose voice was Pearl Bailey, told that fox, you better get you some education, you better learn something about this real world. And in the meantime, the hound was growing up and taking on the ways of a hound. And although as babies foxes and hounds can get along together, once they get some size they don't get along. Foxes don't run with hounds, they run from hounds. And hounds don't run with foxes, they run after foxes. So a point was reached and the hound could have killed the fox, but he thought back to that day when they were young and he told the fox, hounds and foxes don't get along. But because of the way things were in the past, I'm going to lot you go this time, this time only. Don't let us be together like this again because it will be different and I will be a hound and you will be a fox and I'll do to you what hounds do to foxes. So that's a little...that's my rendition of that story of the fox and the hound. Today I'm saying what the hound said to the fox. I'll let you go this time, but after this time don't let me catch you like this again because you are the...
SENATOR CROSBY: One minute.
SENATOR CHAMBERS: ... quarry and I am the predator. And I will not relent again. So somebody out there who's doing all this negotiating needs to tell me something. Can somebody from one of these groups tell me what it is you all are going to do this evening because I'm telling you this is the last chance you get from me.
SENATOR WILL: There's a motion up there to adjourn.
SENATOR CHAMBERS: All right. They're throwing in the towel.
SENATOR WILL: I didn't say it was agreed to, (inaudible).
SENATOR CHAMBERS: Well, I'm going to... I've got to complete what it is I'm going to say before they take up that motion. Remember this, the little fox, (yipping noises), the hound (woofing noises). So if you get out of here tonight, as far as I'm concerned, you're (yipping noises) and I am (woofing noises). Don't let me catch you. When this bill comes up again at any stage of debate, I'm going to do everything...
SENATOR CROSBY: Time.
SENATOR CHAMBERS: ... under the rules to stop it from moving.
SENATOR CROSBY: Thank you, Senator Chambers. You've heard the closing. The question is the adoption of the Chambers' amendment to the committee amendments to LB 401. All in favor vote aye, opposed no. Record, please.
CLERK: 1 aye, 14 nays on the amendment, Madam President.
SENATOR CROSBY: The amendment fails. Mr. Clerk, do you have items for the record?
CLERK: I do, Madam President. Senator McKenzie, amendments to LB 865; Senator Coordsen to LB 389; Senator Matzke to LB 798; and Senator Beutler to LB 658. .(See pages 1957-65 of ..the Legislative Journal.)
Senator Chambers, FA272, Senator. (Found on page 1965 of the Legislative Journal.)
SENATOR CROSBY: Senator Chambers, to open on your amendment.
SENATOR CHAMBERS: Mr. Clerk, is this the one where I have a good amount of textural material changing various figures?
CLERK: Yes, sir.
SENATOR CHAMBERS: Thank you. Madam President, members of the
Legislature, this is a serious amendment and the others I offered in seriousness, but this is a serious amendment. This would change the entire approach of LB 401. 1 will mention the third part of it first. It would strike the new language on page 2 and reinstate the old language, the original language. That means this part about this tax cut would be stripped out of the bill. Then I would offer this family amendment. What it would do at page 1 in line 15, it would strike and show as stricken from the original law 4,000, 30,000, and $46,750 and instead it would insert 4,800, 34,000, and $53,000. Let me tell you the significance of that. It's dealing with the way married people file. It deals with married people, Senator Jensen, between one man and one woman, your kind of marriage, Mr. and Mrs. Jensen. And what it would do is allow a married couple to simply double the amount made available to a single person when filing, before they start gouging you. If you'll notice that the single individual the three sets of figures are 2,400, 17,000, 26,500. When you get to the married couple, that amount doesn't double. They say two can live as cheaply as one but not nearly as well. So if you have two people here, both of them are earning income or if you only have one of them working but they're going to file as a couple, however that works, it's been BO long since I was in that unfortunate state of bliss or that state of fortunate bliss or whatever it was, I forget exactly how you do this kind of thing but what I'm trying to do is for those people struggling and trying to maintain the bonds of matrimony, traditional bonds, American bonds, savings bonds, from James Bond, what I'm just doing is for the married couple treating them as though they are two single people. Instead of saying that if they file as a couple, instead of doubling the 2,400, they get $4,000. That's the way the law is now. I would raise that 4,000 to 4,800 which doubles what would be the case of a single individual. The second column or the second figure for the single person would be 17,000. Currently, for the married couple it's 30,000. 1 would raise that 30,000 to 34,000 which doubles the 17,000 available for the single person. Then at the final figure which is 26,500 for the single person, it would be 53,000 for the married couple instead of the 46,750. Then below that in' the existing law is an amount that is available if a married couple would decide to file as individuals. They are not able, when they do that, to gain for each individual the amount that a single person would get. They
simply divide in half the amount available to the married couple. But the amount that the married couple gets under the current law is not double what the single person would get. So what, in effect, I would be doing is eliminating the distinction that exists between a single person filing or two people filing as a married couple or if they're married and decide to file individually. It would be the same for everybody. I am not putting a disadvantage on anybody for being married. For those of you who believe in the family, it seems to me you would support this amendment. It is a serious amendment. Since by doing it this way we benefit married couples, I would do away with all of -%.-his language relative to a tax cut, but I would leave untouched the provision in the committee amendments that allow for that credit exemption, so everybody would be able to gain something. If you would agree to do this for the married couple, then in order that the single person not be left out entirely, we would... I would offer an amendment to raise slightly the amount that a single person would gain by way of a benefit, a little more that they could make before they start to be gouged. Or in other words, if they make below a certain amount they're not going to be gouged or I should say taxed. But this amendment I'm offering and I am serious about it. I doubt that many have paid enough attention, I didn't say any, many probably have not followed to be aware of what it is that I'm suggesting. So this one may be defeated out of hand as have all the others that I've offered. But this is a serious amendment; and if there's any opposition to it, I'm prepared to hear that. But as I look around the Chamber, I see the milling continuing. I don't see any furrowed brows. I don't know if that means they're reaching an accord or if they're just so tired now that all of their muscles have gone flaccid and their faces are expressionless. But I'm going to continue presenting my arguments, continue the discussion so that they can continue to try to reach some kind of an agreement. And what we might find happening more serious debate is occurring right now away from the microphone than has occurred on the mike. More debate of a serious nature is occurring now than would have happened if we had just pulled all the amendments and allowed the bill to advance. This is the stage where we should debate; and whether it's on the mike or in the way that people are doing it now, then it's something that I think ought to be done. We may be reaching some kind of a resolution one way or the other, but I
don't know yet what that is. Senator Crosby, I'm like those people who say those long prayers and they stay on their knees till the bones come through the skin and then they just look up at the sky wondering if there's going to be any answer and if there is, will it be manna or a thunderbolt? I just don't know. And until somebody punches on their light or takes some kind of action, I guess not only will I not know but the rest of us will not either. How much time do I have on my opening?
SENATOR CROSBY: A minute and a half.
SENATOR CHAMBERS: Thank you. I'm going to continue, oh, Senator Wehrbein just made that mark, that gesture across his throat as if to indicate that it's over. So I guess the foxes decided that the hound can revert to form and be a predator. I'm going to hunt this bill down now and I'm going to grab it. I'm not going to let it go. And if I can kill it one way or the other, that's what I intend to do.
SENATOR CROSBY: One minute.
SENATOR CHAMBERS: Madam President, in the spirit of collegiality, I will not take my full ten minutes. Whatever seconds remain I will relinquish them.
SENATOR CROSBY: Thank you, Senator Chambers. Mr. Clerk, do you have items?
CLERK: Madam President, just one item and that's Senator Beutler has an amendment to LB 401 to be printed; and Senator Chambers, amendments to 401. And Senator Jensen would like to add his name to LB 877; Senator Chambers to LB 864. (See pages 1965-66 of the Legislative Journal.)
I do have a priority motion. Senator Dierks would move to adjourn until 8:30, May 14, 1997.
SENATOR CROSBY: There's been a request for a call of the house. All in favor vote aye, opposed no. We're voting on whether or not to have a call of the house. Record, Mr. Clerk.
CLERK: 20 ayes, 12 nays to place the house under call.
SENATOR CROSBY: The house is under call. Would all senators please record your presence. Would those unexcused senators please return to the Chamber and record your presence. Would all unauthorized personnel please leave the floor. The house is under call. Senators, would you please return to your seats and check in so we may go ahead with the vote and be sure who is here. Senator Bohlke, Senator Bromm, Senator Robak. Senator Robak, the house is under call. Senators, I will remind you that the house is under call and you are supposed to be in your seats. We are waiting for Senator Robak. There's been a request for a roll call vote on the motion to adjourn. Reverse order. Senator Chambers. Thank you. A roll call vote on...the question is, shall we adjourn till tomorrow morning at 8:30? And a roll call vote has been requested in reverse order. Mr. Clerk, please call the roll.
CLERK: (Roll call vote taken. See page 1966 of the Legislative Journal.) 10 ayes, 22 nays on the motion to adjourn.
SENATOR CROSBY: We are not adjourned. I'll raise the call. Mr. Clerk. Senator Chambers had opened on his amendment. Discussion on the Chambers' amendment. Senator Withem.
SPEAKER WITHEM: Yes. And I don't know if Senator Chambers will object to this or not. I think we had some discussion. LB 401 is a major proposal. Okay, let's do it the clean way then.
SENATOR CROSBY: Senator Chambers.
SENATOR CHAMBERS: I will withdraw my amendment.
SENATOR CROSBY: No objections, it is withdrawn.
CLERK: Madam President, I now have, pursuant to the Speaker's authority with respect to major proposals, an amendment to the committee amendments by Senator Withem. (See page 1967 of the Legislative Journal.)
SENATOR CROSBY: Senator Withem.
SPEAKER WITHEM: Yes. The amendment is on the desk and it
should be entered into the computer rather soon, not quickly. Take back what I said about Carol actually running this place then in that case. No, seriously, it will be...it's a simple amendment in terms of understanding. Currently, the committee amendment, as I understand it, contains a transfer from the Cash Reserve Fund. It contains a hold-harmless for LB 1059 provision. it contains a $20 per person tax credit and 5 or 5.5 percent, Senator Wickersham, 5.5 percent reduction in the income tax rate. What this amendment would do, it would only go to the one portion of the committee amendment and it would change the 5.5 back to 3.5 percent. The ... how did we arrive at 3.5 percent? We sat around back here saying let's go back to the original committee amendment which would have been a $20 credit and a 3 percent reduction in the rate and some people felt that that unfairly treated those who favored the concept of a rate reduction as opposed to a credit and so we arrived at the idea of 3.5 percent. Is this the agreed to magic compromise amendment? Probably not. I think, you know, some people back here felt like they didn't want to do this. Some people would rather go home and let the thing percolate a little bit. Some people think if we're going to do this we ought to do a reduction in the credit commensurate with what we're doing in the rate decrease. My view is those are issues for Select File. I think it would be a good idea for the Legislature, before we go home today, to advance LB 401 in some form, recognizing that all of the components that we talked about at 1:30 today being contentious issues, the amount of the cut, whether it ought to be credit or whether it ought to be rate reduction or a combination of both, whether it ought to be permanent, and whether we ought to fund it with a transfer from the Cash Reserve, all of those are still pending issues when we get to Select File, all of which I may develop stronger views on personally myself. At this time I think it important, though, some people think it important that we simply not advance the green copy of the bill. I think that's largely a symbolic issue; but for Senator Chambers and others who share that view it's a very important symbolic issue. And in the political process, symbolism is important. What this does is it indicates that we're not simply going to advance the green copy of the bill. I understand that. I think it also, though, important that the headlines tomorrow not say Legislature grinds to a halt over the issue of an income tax cut, because I do think it
important that we send the message that we do recognize that there is a significant surplus out there and that a portion of that surplus needs to be returned to the citizens in the form of an income tax cut. The amendment, and I will not speak much further on it because I think we ought to move ahead and advance this as quickly as possible and then have our major debate as we get to Select File as we had originally proposed to do several hours ago, so I will just simply close on my opening by indicating, reiterating that all this does is it leaves everything else in the committee amendment in place. it reduces, however, the fiscal impact of the income tax cut from $171 million that would be there now over a 2-year period, does not take it all the way back to the $121 million that the original committee amendment. We don't have the full fiscal analysis of it, but my guess is it would be somewhere in the 130 to $135 million range. That is a purely uneducated guess but, Senator Wehrbein, you may want to respond to that and tell me how far off the mark you think I am. With that, I would urge the adoption of the amendment and then the advancement ... then the adoption of the committee amendments and then the advancement of the bill.
SENATOR CROSBY: Thank you, Senator Withem. Discussion on the Withem amendment? Senator Beutler followed by Coordsen, Kristensen, Wehrbein, Wickersham, Dierks, Maurstad and Brashear. Senator Beutler.
SENATOR BEUTLER: Senator Crosby, I'm not quite sure what to say at this point. We've all struggled mightily here for a solution. So I don't want to take any time on this particular amendment. I guess I'm for it if it helps get it to Select File. However, having said that, the major concern for me individually was the fact that this cut is permanent in nature and I don't think that there's any mathematical scenario that would support a permanent cut even at a 3.5 percent level, and it still collides with our obligation to reduce the property taxes from $1.10 to $1 three years hence. And so I guess I will sit back and listen, but my amendment is up there following this one that would limit it to two years. And if it doesn't take us much time, I think that ought to be a part of this deal to advance also to limit it to two years. So if we cut it to 3.5 percent and limit it to 2 years, everything would be in the
realm of what's real and what's realistic come Select File. And I would sure rather see it that way than just with the reduction to 3.5 percent, but I will listen and see what other people think. Thank you.
SENATOR CROSBY: Thank you, Senator Beutler. Senator Coordsen.
SENATOR COORDSEN: Thank you, Madam President, members of the body. This is, with some notable exception, puts us fairly close to where the Revenue Committee was at the time the bill was advanced to the floor which was...and there are some differences. Certainly I agree with Senator Beutler with respect to putting some time limits on to ensure that it's looked at again. The value I suppose to doing this bill at all is that going into the future it reduces the amount of money that we would have available here in the Legislature for other spending measures. My priority certainly is not this. I am still committed to finding money primarily for K-12 education to ensure continued quality education with the levy caps that are going to be coming along in a little over a year. I'm going to support this amendment at this time. It represents, I think, a reasonable compromise. I certainly would like to see the sunset put into it at least on the rate Bide rather than the credit side, because I think the working people in the state of Nebraska have not had a sufficient credit since we switched from the federal income tax percentage plan that we had to the current state income tax plan. And it's time we modernized that for the families in the state of Nebraska. But for the purposes of tonight, 1 am going to support this amendment by Senator Withem. Thank you, Madam President.
SENATOR CROSBY: Thank you, Senator Coordsen. Senator Kristensen.
SENATOR KRISTENSEN: Thank you, Madam President, members of the Legislature. I just want to make sure I ... I don't see Senator Withem just right now. Senator Beutler, you don't have to respond to the microphone, but your ... the amendment that's following limits this to two years for both the rate and the credit. Is that correct? Okay, thank you. And, Senator Chambers, if I could have a moment with you on the mike. This amendment takes the rate to 3.5 percent reduction in the income
tax. It has a credit on there for $20. It does keep in what Senator Maurstad wanted to do with his transfer of the reserve monies in this first biennium. That's an issue I had. I'm willing to give that up. If we do the current amendment and do Senator Beutler's amendment that follows, it limits it to two years, you had made some offers, is that acceptable to you?
SENATOR CHAMBERS: Yes.
SENATOR CROSBY: Senator Chambers.
SENATOR KRISTENSEN: Okay.
SENATOR CHAMBERS: Madam President, yes.
SENATOR KRISTENSEN: Thank you, Senator. And, Senator Withem, I don't know where he went.
SENATOR CROSBY: Senator Withem, will you yield for a question?
SENATOR KRISTENSEN: I'M sorry to interrupt you, Mr. Speaker. I was just trying to make sure that everybody understands what this is. Yours is a 3.5 percent reduction in rate, $20 credit, you keep in the cash reserve things that Senator Maurstad had done originally and some 1059 things. The next amendment is Senator Beutler and his is for two years. If your amendment now passes, Senator Beutler's amendment passes, is that acceptable to you?
SPEAKER WITHEM: Many things are acceptable to me. I'm trying to facilitate as opposed to impose my policy views on things. I would like to see the bill advanced. If the body is more comfortable advancing the bill with the two-year limitation, I will feel comfortable with that. If the body is more comfortable advancing the bill without the two-year limitation, I'm comfortable with that.
SENATOR KRISTENSEN: Okay, thank you.
SPEAKER WITHEM: And it's not an attempt to be ambiguous, that's just where I'm. .pretty good at being ambiguous even though that wasn't my goal, I guess.
SENATOR KRISTENSEN: I understand I think I need the two-year reduction as well, Senator Beutler, so I would hope that your amendment, if procedurally it's up there next, if we can't put the two-year limitation on there, I'm not sure that I'm interested in going much further tonight. I would hope that we could adopt this amendment, put on the two-year. There are things I don't like about this. I'd certainly like to have the cash reserve things changed because that makes a big difference on how much money is available. I'm willing to do that, let Senator Maurstad have that part of the amendment and deal with that on Select File. And with that, I would hope we could adopt this amendment, adopt Senator Beutler's amendment and move on to Select File and deal with -the matters there.
SENATOR CROSBY: Thank you, Senator Kristensen. Senator Wehrbein.
SENATOR WEHRBEIN: Madam Speaker, members, I am reluctantly going to support this in the sake of advancing and the Bake of the time issue; but I will say there are several issues in here that I am not 100 percent comfortable with. Near my calculations, it's about 125 to 130 million dollars which is above the 117, certainly less than the 175 that was in the committee amendments. But I want to be very cautious and only move it because I want to see how the debate develops on other things that we have coming up which again we'll start tomorrow afternoon. And I know that we can change our mind and we can stop what we're doing if we make a mistake. But I think it is a little early to know exactly where we're headed. I think the body, from my viewpoint, ought to be cautious of that, that we don't know exactly where our spending level is going to go and we obviously don't know how sustainable it is. And I think we'll have to make a strong point of that on Select File to see how sustainable this is going to be. I've long felt that this is too high to sustain at this level using the total dollars. Now there's several ways to massage this, several ways to make it work if we are in fact going to have an income tax cut. But we haven't resolved the LB 806A issue as to what level that can be or should be. And I will say, as I've been saying several times, property tax relief issue, I've come down that that is a higher priority to me than a large, or even a moderate, or even a
lesser income tax cut. That will be the decision the body will have to decide. And then the other issue is then whether all these numbers are going to be sustainable out in the future, because by and large we have a crash the next biennium even under the most favorable circumstances. I have even been reluctant to pull out the cash reserve. We have to pull some money out of that to even make this work. Whether it's sustainable I don't know. No one can make the argument that it is any more than I can make the argument that it isn't sustainable out into the future. Certainly we have a strong economy in Nebraska, but certainly all prognosticators are not entirely correct. Things can change very fast. We can have dry weather, we can have a turn around in the economy that none of us are even foreseeing. So, and I don't intend to get into that issue except to say that I think we ought to be cautious when we're directing the ship of state. And I don't like ups and downs and cuts or tax cuts or coming back into special sessions. one year we came back three times, one to make a $198 million cut as I recall. I do not want to do that again, and I can't predict. I don't want to be a doomsayer and say that we're going to have to be back. I don't anticipate that we will necessarily. But at this point it's premature for me to make that final decision. I'm willing to move this along one more time and so that perhaps in another week or ten days when this comes back we can play these numbers out and we can all see more accurately what it is. So I simply want to Bay I reserve the right and make final judgment in passing this on from General File to Select at this point to me is not an absolute guarantee any way whatsoever that I will support it at Final Reading.
SENATOR CROSBY: Thank you, Senator Wehrbein. Senator Wickersham.
SENATOR WICKERSHAM: Thank you, Madam President. I will rise in support of Senator Withem's amendment and the subsequent amendment by Senator Beutler. The combination of the two amendments I think does bring us to an affordable level and one that this body can adopt at least for purposes of moving the bill to Select File. I understand the concerns about using the cash reserve to fund in part -this tax reduction. I'm less uncomfortable using it if it is limited to two years. I was very uncomfortable using the Cash Reserve Fund to provide for an
ongoing tax reduction which I thought was not good budgetary policy. But the Cash Reserve Fund can be used for limited term expenditures; and if we adopt both the Withem amendment and Senator Beutler's amendment, we will have something that fits the bill. And I would urge your support of both amendments.
SENATOR CROSBY: Thank you, Senator Wickersham. Senator Maurstad.
SENATOR MAURSTAD: Thank you, Madam President. We started out the discussion that we would look at moving the original committee or the original bill, the green copy of the bill over to Select File. That did not transpire this afternoon. There have been a number of different proposals put forward, soma of which that I have agreed to, but the scenario that's been painted now relative to both the Withem amendment and a preceding Beutler amendment I cannot agree to at this point. I would agree to one or the other, as I've indicated during the discussions off the floor. I would agree to the 3.5 percent rate reduction, maintaining the balance of the committee amendment at $20, the cash reserve issue, the hold-harmless issue, and adopt the Withem amendment if there was assurance that we would then adopt the committee amendment and advance the bill, as Senator Withem put forth when he introduced this amendment. But if the intent of the membership is to adopt the Withem amendment and then go down the path that Senator Kristensen and I believe, if I heard correctly, Senator Wickersham are now advancing of then following up and putting a two-year limitation on the rate reduction, I will not support that. And I will urge my colleagues to not support that. I believe that it's important that we move 401 to Select File. I believe that Senator Will and myself, Senator Hilgert, have made appropriate concessions to try to do that. But we can't go the route that's being indicated now. Now let me talk about the sustainability because I have ... you know, I passed out a white copy of the blue copy of what, you know, of the General Fund status. And with the original 401 income tax reduction and with the 100 million that people are talking about and all of the spending that's in the budget, we're 24 million over the required minimum reserve. Now that's with the transfer being stopped so that the cash reserve stays at 40 million in addition to us having the 3 percent minimum reserve. The thought that we
would increase our savings account by another 58 million and possibly even more, depending upon ... based on April actual numbers, to me is not good public policy. We can do the property tax circumstances that have been proposed, the 100 million, plus the community colleges, plus taking over the extension officers, plus ESU money, we're doing a lot in the area of property tax reduction. We can do the income tax reduction. I still believe we could do the Maurstad amendment that's now part of the committee amendment. But we really haven't had an opportunity to make that case so I'm willing to say okay to move the bill over, let's reduce the amount of the dollars down to roughly 130 million that the Speaker has indicated. Maybe that's the form that needs to be advanced to Select File. Then we can discuss the issue of whether the rate reduction ought to be permanent or not. Then we can discuss the issue relative to the cash reserve. But I think that can occur when we have more members. There were 44 members that voted on...
SENATOR CROSBY: One minute.
SENATOR MAURSTAD: ... the amendment last week. There's 36 and dropping now. I think the cash reserve issue is important enough. I think the rate ... or the permanency versus two years important enough that more members be here to be involved in that discussion and that debate. So I don't think we should hurry along with too much tonight. I'll support, as I indicated, and I'll listen to what else is said before we vote. I'll go for the Withem amendment if we go immediately to the committee amendments and then advance the bill. Thank you, Madam President.
SENATOR CROSBY: Thank you, Senator Maurstad. Senator Brashear.
SENATOR BRASHEAR: Madam Chair, members of the body, I'm ... this is the first time I've spoken on anything related to LB 401 on the floor. I'm very bothered by the Withem amendment, but I may support it but I'd like to share my reasoning. Without in any way demeaning the process, all of this is a little bit about negotiation. I didn't support the Maurstad amendment that has become the committee amendment because I thought it established too high a watermark as to all things. But nevertheless, I
think the fact is everybody bid. We're all adults. Everybody bid. The bid was 5.5 percent on the cut and it was $20 on the credit. The bid was 5.5 percent permanent and the credit was $20, 2 years. Everybody bid. What I don't like about the attempt to move it forward if we're all moving it forward in order ... as a matter of forward progress in a spirit of collegiality in order to allow more time so that we can take it up and resolve our differences on Select, then let's move it forward fairly. We're talking now about, those who bid at 5.5 percent permanent for a cut are taking a 40 percent hit here now on General File. But those who bid for a $20 credit twice, 2 years, are moving forward intact. It simply doesn't...it isn't forward progress on a fair and equal basis. When you sit down to negotiate, you negotiate as best you can. You make your best case. You start with your starting position and you certainly don't say you'll take one and then raise the price later. And so I feel like the thing is out of sync, it's no longer symmetrical. We're not treating both points of view fairly, and it requires those of us who happen to be committed to a tax cut, it requires us to go forward with a greater amount of faith or with a heavier burden that we have to come back, whereas those who have moved forward on the credit side have moved forward intact. And that's my concern about it. That's why I'm bothered. I wanted to at least state that so that if I support the amendment as a matter of forward progress it's understood I don't think this is equal, fair and equal forward, progress. I think it's disproportionate and out of sync. Thank you.
SENATOR CROSBY: Thank you, Senator Brashear. Senator Vrtiska.
SENATOR VRTISKA: Thank you, Senator Crosby. I'm not going to spend a lot of time because everybody knows where I'm at. I think that the idea of... it's just been discussed about making deals and getting together and trying to move something is probably not in the best interest of any of us, but I think that's probably what the vote is going to be. I'm not too sure I want to support even this compromise because, as I have spoken many, many times before, my position has always been and will continue to be if we can't somehow find property tax relief because that's where I'm from, if we can't do something about property tax relief along with income tax cuts, then I don't buy
into the bargain. And I don't see in my district where property tax relief is going to be as great as it is in many other places and, therefore, it's difficult for me to stand and allow something to move forward when the package is not complete. And so I suppose, I'm guessing and I think I'm probably right that the bill is going to move, but I think there's going to be more discussion. And I hope that there is more discussion and I hope somewhere in this process that we can address the issue of property tax because we talk about all the time how detrimental the income tax is to the industry and I recognize that. But you ought to recognize for just a moment how difficult the property tax issue is for people in rural areas who are in fact being taxed to the degree where it's difficult to sustain their business and stay in operation. We see years ... we see people in my district who there are years when they don't make enough off of their property to even pay their taxes and yet we continue to say property tax is not a burden. Well, if you own property and the only source of income you have is off of that property and the taxes get to the place where it's almost confiscatory, then you can understand why I continue to feel like I do that if we can't include some type of property tax relief in a proposal then it's difficult for me to say that we should do things for other people but leave out one sector of the society. I'll give the rest of my time back. Thank you.
SENATOR CROSBY: Thank you, Senator Vrtiska. Senator Maurstad. He waives off. Senator Withem. Senator Withem, yours is the last light. Would you like to close? Thank you.
SPEAKER WITHEM: To reiterate, the amendment is to lower the. reduction in the committee amendment which is currently 5.5 to 3.5 percent; would recognize that this is being done for purposes of advancing the bill. Senator Brashear made an eloquent case that if we're going to reduce we ought to reduce both the credit and the rate. That may well be what the body ultimately wants to do. There are a number of other policy issues that need to be decided and need to be debated. At this point simply so that we can get the bill moved, I'm suggesting that we adopt this amendment. I would close and go with a machine vote.
SENATOR CROSBY: Thank you, Senator Withem. You've heard the
closing. The question is the adoption of the Withem amendment to the committee amendments to LB 401. All in favor vote aye, opposed no. Senator Withem.
SPEAKER WITHEM: Yeah. I would request a call of the house.
SENATOR CROSBY: Request for a call of the house. All in favor vote aye, opposed no. Record, please.
CLERK: 29 ayes, 0 nays on the placing the house under call, Madam President.
SENATOR CROSBY: The house is under call. Would all senators please take your seats and record your presence. Would all unexcused senators please return to the Chamber and record your presence. Senator Withem.
SPEAKER WITHEM: Call-in votes.
SENATOR CROSBY: Thank you. We are voting on the Withem, amendment to the committee amendments, and Senator Withem has indicated he will accept call-in votes.
CLERK: Senator Chambers voting yes; Senator Maurstad changing from no to yes; Senator Dwite Pedersen voting yes; Senator Will voting yes; Senator Chris Peterson voting yes; Senator Brown voting yes; Senator Tyson changing from no to yes; Senator Matzke voting yes; Senator Stuhr voting yes; Senator Jensen voting yes; Senator Hillman voting yes.
SENATOR CROSBY: Record, please.
CLERK: 26 ayes, 0 nays, Madam President, on the adoption of Senator Withem's amendment.
SENATOR CROSBY: The amendment is adopted. Mr. Clerk. I will raise the call.
CLERK: Senator Beutler would offer AM2069. (See page 1914 of the Legislative Journal.)
SENATOR CROSBY: Senator Beutler, to open on your amendment.
SENATOR BEUTLER: Senator Crosby, members of the Legislature.
SENATOR CROSBY: Sorry. That amendment did carry. I don't know if I said that so, Senator Beutler, go ahead.
SENATOR BEUTLER: I assume this will be the last amendment we'll have up today and it's just a matter of the message I think you want to deliver to the public as we move forward to the next round of debate. This amendment simply puts a two-year limitation on the tax rate decrease that is presently* in the committee amendment. That's all it does, two-year limitation. When you and I first came into the Legislature this year and when we acted in the Legislature last year, we all knew what we were doing. We all knew what the big subject was. We all knew the problem we had to resolve, and it was a problem of property taxes and property tax relief. And I think we still even at this moment in time have a credibility problem out there with the public with respect to whether we're really going to get down and solve that problem because all of a sudden they've been hearing so much about an income tax, an income tax cut. And I think they're going a little crazy out there thinking, well, they were going to solve the property tax problem and now, my God, the headlines is always about this income tax cut. The message I think we need to give is, folks, we're solving the property tax problem first. We're going to give you an income tax cut, too, if we can do that. But we want you to know and to recognize that financially we may not be able to do both. And so as we move this to Select File, we're putting some limitations and delivering a message to you that the income tax cut is not the first and foremost thing that we're here to do this year. We're going to follow through with what we promised on 1114. And for that reason and because in my own mind looking at the financial figures I don't think you can do the income tax permanently in any event and still give the $1.10 to $1 reduction in property tax, for those reasons I think that the reasonable starting point on Select File, the message we want to give people as we begin the debate on Select File is that we're going to do the income tax only if we can deliver to you what we promised on the property tax. And so we present to you on Select File a limited version of an income tax amendment. We can do better if the financial figures, after we've all examined
them, look better, we may extend that to be something more permanent. But for right now this is what we think we might be able to do and we want to resolve on Select File the property tax problem first and we will do more if we can. And I think that's the message you give if you limit this to two years before you advance it to Select File. I hope you feel comfortable with that. Thank you.
SENATOR CROSBY: Thank you, Senator Beutler. Discussion on the Beutler amendment. Senator Maurstad.
SENATOR MAURSTAD: Thank you, Madam President. As I indicated when we spoke on the previous Withem amendment, and after second thought I originally voted no against that because I knew this amendment was going to happen, I changed my mind and in good faith went ahead with the rate reduction. I can't accept and I would ask those individuals that supported the amendment that was adopted last week to vote against the Beutler amendment because I think we can move the bill over to Select File as it is with what was attained last week except for the change in the permanent rate reduction. I think that it's a bit of an exaggeration, although I understand Senator Beutler's concern. This session has been dominated by school finance and property tax relief. We had one couple hour debate on income taxes, and up until that point where 25 members showed the resolve to have an income tax cut, there was not a great deal of conversation nor was there much expectation that there would be much of an income tax cut. So my proposal, as I indicated, would be to go ahead and move the bill as it was amended with the Withem amendment, adopt the committee amendment, and then move the bill. Now Senator Chambers may or may not go along with that 'at this point in time. But I guess we'll have to deal with that. But we're going to definitely I would guess have a vote on the Beutler amendment. I would ask people to not accept the Beutler amendment. We can address the issue on permanency on Select File with more members here to listen to the importance of this discussion. It's an economic development issue. We all know that, nothing to be ashamed about that, part of the discussion. We're going to continue to grow this economy. We're going to continue to try to put in place things that will attract businesses and workers, create jobs into this state so we can sustain the good period that we're having now. I think the
income tax cut needs to be permanent to send that message that we can keep our state fiscal house in order with a very modest now, very modest personal income tax decrease. Sends a very weak message to have a very modest 3.5 percent across-the-board rate decrease for 2 years, not much of a message, not much impact. We can do the income tax cut. We have it down to a level that's now more acceptable to people at 120 million or so, 130 million, but let's leave the rate reduction permanent. We maintained what I think was an important part of this at this stage on General File and that's the equity issue of the tax credit. There has not been any attempt to eliminate the tax credit on General File. To me that was an equity issue within the Revenue Committee to get the bill out on the floor. That's been honored. As I indicated, I think that now is the time the bill is in the shape to move it over to Select File and would ask that the Beutler amendment be voted down, we advance to the committee amendment, adopt the committee amendment, and move the bill to Select File. Thank you, Madam President.
SENATOR CROSBY: Thank you, Senator Maurstad. Senator Withem followed by Chambers, Wehrbein, Kristensen, and Brashear. Senator Withem.
SPEAKER WITHEM: Madam President, members of the body, I am going to ask people to make up their mind on the Beutler amendment as they see fit and regardless of how the amendment goes to vote to advance the bill. I think we've spent a lot of time on the bill today. We have it in pretty good shape. We appear to have one...we have a number of policy disagreements that have not been resolved. I don't want to overemphasize the amount of consensus that has been reached today because it's ,probably remarkably small. But we seem to be getting to the point where we are getting enough consensus, enough consensus to get the bill advanced at any rate. I would ask people to vote their conscience on this amendment and then vote to advance the bill. I say that not as a strong advocate for either position obviously because I haven't told you how I'm going to vote on the Beutler amendment and I'm candidly not sure how I am. I say that to put a little overall perspective on the bill in terms of overall scheduling. I know two or three years ago I made some comments to Senator Avery on the floor about time being taken and the ability to reschedule bills and things like that and
Senator Witek, who is a cosponsor of this bill and has long gone home, but brought up, thought I was threatening. So I want to make it clear that I'm not threatening anyone. But the days are waning. The agenda is pretty well set for the rest of the week. This bill will probably not make it back to the agenda until the beginning of next week. It will be one of the lone General File priority bills, major proposals still sitting on General File. I think it's important for those of us that want to see an income tax bill as part of the overall deliberations will ... to get this bill advanced today. So make your policy arguments but then I hope regardless of the way your views go on this measure, I hope you will advance the bill. My concern is with the limited numbers we have here today, including three cosponsors of the bill being gone at this point, that we will melt down on the Beutler amendment. The Beutler amendment with 33 people here may not have the votes to get adopted. My fear is then those of you who don't like the Beutler amendment will feel good about having defeated the Beutler amendment but you turn around, you have to pull 25 out of 33. It's not your fault those of you, the 33 that were here, certainly it's not your fault but that's the reality of what we have. So keep those things in mind. My desire. is to see the bill advance and I know it's tough, Senator Beutler, to get your amendment adopted with only 33 people here. I know it's tough then to get the bill advanced with only 33 people here. Those are the cards we're dealt and this time in the session you have to play the cards you're dealt.
SENATOR CROSBY: Thank you, Senator Withem. Senator Chambers.
SENATOR CHAMBERS: Madam President, I've said a lot today on two bills and talked about some other things along the way. But now we're at the point where it's not necessary for me to say much of anything. Without the Beutler amendment, there's no way I'm going to support this bill. And with the Beutler amendment, I'm against the bill as far as passing it. So those who think that with this miscalculation that was made by that board we should .base a perpetual program of state spending, I say that's unwise, very unwise. My understanding was that the Beutler amendment would be a part of that first offering, but since it was not, it should be adopted now. If it is not, I would hope all those senators who told me that they would not support the bill
without the Beutler amendment, meaning the two-year limit, will stick by that and not support the bill. Without Senator Beutler's amendment, this bill should not move today. I'm going to give to Senator Bohlke, Madam President, I'm going to give to Senator Bohlke whatever time I have remaining.
SENATOR CROSBY: Thank you. About three and a half minutes.
SENATOR BOHLKE: Thank you, Madam President, and thank you, Senator Chambers. I rise in support of the amendment. And I've listened to. the debate, off and on, the majority of the afternoon. I haven't spoken. I heard Senator Withem talk about tomorrow and the newspapers and how they will view what we have done. And as I listened to that, and the people I think who are watching us this evening, it only makes sense, I think common sense, that they would say, why not do a two-year limit because we're operating with facts in a time frame that certainly are ones that, that have some validity. Any time that we, we go on beyond that, I think there's a great danger in placing something of permanence on a projection. I think that it makes common sense. I think the people watching us and the people who'll be reading the paper tomorrow would understand that anyone, as they're developing their budget, has a forecast for the next biennium that they can be fairly sure that they can trust. I think that they would think that it makes good common sense that we act the same way and say, we have this information now, we can be certain over the two-year period that this is a number that will be factual. And with that I think that people would think we were doing a responsible job in trying to do the budgeting here in the Legislature. And so with that I give my remaining time back to the Chair. Thank you.
SENATOR CROSBY: Thank you, Senator Bohlke. Senator Wehrbein.
SENATOR WEHRBEIN: Madam Speaker and members, I'll be brief. I strongly support Senator Beutler's amendment. I simply say that I think if we're going to err, we ought to err on the side of caution at this point. There's plenty of time to change in the future, if that be the case. But at least we can see how the numbers work out. We'll have ... the more information we have, the more accurate we can project into the future. There's time to do that. This is not the time to send a message to the
public that implies into the future far beyond, I think, what we can actually see. If there is truly room for an income tax cut that can be made permanent, we have time to make that decision. We will know better in the future whether we can maintain that cut. There's no sense sending that message now. I'm reminded one of the things the way the federal farm program works, there's lots of money flowing into agriculture right now as we phase down in our, in our farm programs. That's a seven-year phase down, and there's quite a bit of money flowing in right now, and that's going to start to go away, just for an example. With the amount of money that looks ... we're looking. strong in agriculture right now, I see no reason that it can't continue in a lot of ways. But on the other hand, we don't know that it will. And markets are erratic, this is still an agricultural state, apologize if that offends some that ... talking about agriculture because that's my bias. But it is part of, a big part of our economy. I simply think that we ought to err on the side of caution. I think two years is, is a very reasonable suggestion at this point and I would urge it be made part of, of this committee amendment.
SENATOR CROSBY: Thank you, Senator Wehrbein. Senator Kristensen, followed by Brashear, Maurstad, Beutler, and Vrtiska. Senator Kristensen.
SENATOR KRISTENSEN: Thank you, Madam President and members of the Legislature. I...the reality, I suppose, at this point in time is that you've got short numbers on both sides. And I think that it's probably clear that there are at least 25 people, at least in my opinion, I think there's 25 people, whether they're here right now or not, that would vote to do this for two years, and move it on to Select File. That doesn't mean that they're going to vote for the bill. I think there's a number of people that said we don't, we shouldn't have an income tax, period. There are people out there who say that we should have a larger income tax. I think the reality is that if you don't get a vote tonight for the two years, the bill won't move today. If it doesn't move today, I doubt if it's on the agenda the rest of this week, and you move it over to next week. And as you move then within the ten-day period of time, we all know what's going to happen in those last ten days. A bill on General File is going to be very, very difficult to get taken
care of. And so I know that there, there's parts of it now that people may not want to do. But the two year one is probably the crucial issue to moving it across. It's for a limited period of time. If you keep it permanent, it'll be extremely hard to change on Select File. I don't even know if you get to Select File if you don't do that. So I would hope that you would take tonight, look at that two years, and say, I understand that that's the flexible position, that's the one that keeps the most options open, and that's what we ought to do. Move that bill to Select File if you want an income tax cut. If you adjourn, or if you don't get the two years, the bill doesn't move, becomes a very, very difficult task next week. And I think it's no more complicated than that and I'd hope that you'd vote for the two years.
SENATOR CROSBY: Thank you, Senator Kristensen. Senator Brashear.
SENATOR BRASHEAR: Madam Chairman, members of the body, I think we're probably a couple votes too late to start worrying about what the newspapers report about us on this subject, or hoping that it makes any logical sense. And ironically, I, I have been thinking, as we went along, when we were adopting the Maurstad amendment and those things, I was thinking that this ought to be limited. And now I find myself in a position of imploring you, as a matter of fairness, to advance the bill without the two year, without the Beutler amendment and without the limitation. And I'll take just a moment to explain why. Senator Chambers has indicated that he Will support the ... he will support the advancement or whatever if we adopt the Beutler amendment. He's one vote. But he is ... but he's going to oppose the bill at the next stage. Well, this has all been done here at the end of the day in the name of forward progress and collegiality or compromise or whatever you want to call it. Well, I would implore you to leave with those of us, whether you agree with us or not, leave with those of us who have dealt in good faith, who believe in and stand for a tax cut, I being one of-them, and indicating I would... I don't think it has to be permanent, leave us at least one card in our hand. Don't take a total, in the name of compromise, in the name of forward progress, and not a final result and a fight yet to be had on Select File, please don't take everything. Let's decline the Beutler amendment.
With all due respect to Senator Chambers and without his support, let's advance it to Select File. Let's say this is what it's like when they say, you don't want to watch ... what is it, Senator Janssen, it's like sausage, you don't want to watch it being made, but we hope and we believe and optimism will get to a good result, but let's leave it there. And then we'll deal with the issue of permanency and amount and credit, and do all things we said in the aisles here this afternoon, what we're going to do on Select File. We'll really do them on Select File, not by attrition and neglect and hurry deal with one side of the equation here and the other side of the equation later or never. Thank you.
SENATOR CROSBY: Thank you, Senator Brashear. Senator Maurstad.
SENATOR MAURSTAD: Thank you, Madam President. I rise in opposition to the Beutler amendment. I think Senator Brashear has made a very compelling argument. I would draw everyone's attention to pages 16 and 17 of the 1995 annual report on the Department of Revenue, and you'll get an idea of what's happened since 1987 relative to our individual income tax. We've raised it. We have never lowered it. Rate bracket three took a very small decline and adjustment in 1993. There was some changes in the, in the range of brackets, but the rates have been in place. We're not on any roller coaster up and down relative to income taxes. Caution is great. Caution is prudent advice. We ought to also have some caution on the spending side then, also. What we do is we build a budget and we develop a base in our budget, and I've served on two budget cycles now and you can't crack into that base. We call increases in spending cuts because they... those increases in spending didn't meet historical averages. Those are cuts. Those increases are cuts on the spending side. Where is caution there? It's a critical issue now because Senator Chambers has continued his day long opposition to the bill. That is not an unusual circumstance, is it? It's not, is it, Senator Chambers? That's nothing unusual. That doesn't make what we're doing right now, critical. We expected that, those that are supportive of the income tax cut, this was going to happen at some stage, maybe all three stages. Not only on this bill but many others. I'm not going to talk much longer, I think you know what my position is. I think we need to advance the bill, as it is now, in the spirit of
compromise, in the spirit of willingness to take up a number of the critical issues on Select File. I ask you to oppose the Beutler amendment, adopt the committee amendments, and advance the bill. Madam President, I'll yield the balance of my time to Senator Hillman.
SENATOR CROSBY: Senator Hillman, you have about two and a half, well, two and a half minutes.
SENATOR HILLMAN: Thank you, Madam Speaker. Thank you, Senator Maurstad. I just had a couple comments that I wanted. to make. When you first started talking and debating about the income tax cut, and whether or not this was going to be, some of the things I heard was that we didn't want to do an income tax cut because we didn't want a roller coaster effect. That we would cut taxes and we would come back in and we would raise taxes, and so we didn't want to do the tax cut at all. Now what I here is, yes, we want to do a tax cut, but we only want to do it for two years. I'm one of those that doesn't think we should have a roller coaster event when it comes to taxes either, but that's exactly what we're initiating if we go with the two-year moratorium and that we will in two years, and we'll look at it again. You are looking at a roller coaster. And whether or not we would continue it or not, the perception would be there is that, well, in two years they're just going to up it anyway. It's a modest amount. If you look at where we've been across the spectrum, it's a modest amount. And those of us that want to see an income tax supported that. But for me, and I've said all along, I think it ought to be ongoing. It should not have a sunset on it. It doesn't do any good in the area of what many of us were looking for was advantages for economic development.
SENATOR CROSBY: One minute.
SENATOR HILLMAN: Because anyone that looks at us, if we're thinking that we're going to attract jobs or use it as an economic development tool, when you have a two-year limit on it, it won't work at all. You will not see any business coming in with that kind of insecurity in their tax base because they like to know what they can expect. I would vote for the amendment, I did, to advancing the bill. But I think it's, really at this point it's asking too much to put the two-year sunset on it.
We've reduced it. There's some things in it we can look at, at Select File. But for tonight, I will oppose the amendment.
SENATOR CROSBY: Thank you, Senator Maurstad and Senator Hillman. Senator Beutler.
SENATOR BEUTLER: Senator Crosby, members of the Legislature, a matter of fairness? A matter of fairness? Isn't fairness a broader matter than some little deal we make on the floor, to which not everybody agreed to, by any means. There was no, there was no general agreement. It's not fair or unfair to do this amendment. But if you're going to talk fairness, -hat about fairness to all the property taxpayers Out there? What about fairness to them? What about fairness to the constituents and the consumers? And if you want to talk about fairness, think of the struggle we just had on (LB) 806. Think of that struggle. And we're struggling still to adjust that formula, to figure out how to help all the schools, and to figure out how to help all the kids. Don't we have to be fair to them first, property taxpayers second? Aren't those the two primary goals to take care of the kids' education, to take care of the property taxpayers? That's where the broader and larger question of fairness is. And I don't see how advancing an income tax cut and pretending that it's on the same scale are matters the same as doing what we said we would do, as doing what we said we would do last year. Giving property tax relief, protecting the school children. And this two-year cut is not just my idea, this is plagiarized from the Revenue Committee. This is what your committee, in full and fair consideration and in fairness to all, agreed should be done. It's their concept of fairness, too. I suggest that you do what's right in your own mind. And if you do that, I think you will vote for this amendment because I think it is the fairest approach. Thank you.
SENATOR CROSBY: Thank you, Senator Beutler. Senator Vrtiska, followed by Landis, Dierks, Maurstad, and Withem. Senator Vrtiska.
SENATOR VRTISKA: Thank you, Madam President. I'm just going to take a minute. I want to echo some of the things that have already been said. And I think it's important that we now... I
guess the thing that really bothers me, and I don't quite understand, is if we have, in fact, two years extension on this proposition, and we have all the money that everybody's predicting we're going to have, I don't know why it wouldn't be continued. And I don't know why it's such a big issue that it has to be a permanent thing in the eyes of those who believe that way. Obviously, everybody can think the way they want to, and I, certainly I do and I'm sure everybody else does. But I just, I'm having difficult understanding why, if we put on for two years this type of income tax, and we do have all that money, why wouldn't it be continued? I don't see where it's such a big issue. And so I'm going to support the advancement of the, of the Beutler amendment. But if that doesn't go on there, then I can't support the bill, period. Thank you.
SENATOR CROSBY: Thank you, Senator Vrtiska. Senator Landis.
SENATOR LANDIS: Senator Brashear made an interesting argument. That is, look, you know, in the whole greater scheme of things, with all these differences, shouldn't we have some fair middle ground? Leave us an arrow in our quiver. Let me tell you two arrows in the quiver that you get. Number one, you get a live bill on Select File, available for amendment. Second quiver, second arrow in your quiver, you get it on a full day when everybody's here. And if you've got a majority point of view, you've got a chance to play with a full deck instead of the deck that we have down now. Third, you've also got a rate increase. If we're putting money into this bill, from where it was when it came out of committee, the body is saying, put it in the rate reduction side, don't put it in the personal credit side. My choice is personal credit. So out of that it seems to me that if you are a no vote, and apparently there are eight or nine of you, you do... it seems to me that if you do move the bill in this shape, you get something of value. I am of this mind, I'm going to vote for the Beutler amendment if in the spirit of what that meant, if some other people came on and we adopt the amendment, I would then help move the bill. I'm an opponent of the bill at this point. I'm a no vote on 401. But I would help move the bill in the face of adopting the Beutler amendment and doing the business tonight to remove the ... the schedule problem that proponents of 401 have. That's what ... that's a chip that I can throw onto the table to say, look, I can be helpful in
return for being helpful on that score, and help move your bill. I'm an opponent of 401 at this point. It's different than the bill that I voted to report out of the Revenue Committee. And I do want to say this, understand that we're approaching, with more money in it, an income tax proposal that's consistent with what your Revenue Committee recommended when it came out of committee. It was our best recommendation. And the Beutler amendment moves us closer to that place, not further away. That was the ... that was the best attempt at finding a common ground among all the different threads. And I'd suggest that you've done nothing except to move the bill further, plus putting some more money on the rate reduction side in its current form with the Beutler amendment than if you do nothing. That should be an advantage and it should count for something. I hope you consider moving the bill tonight with the Beutler amendment.
SENATOR CROSBY- Thank you, Senator Landis. Senator Dierks.
SENATOR DIERKS: I call the question.
SENATOR CROSBY: The question has been called. I do see five hands. The question is, shall debate cease? All in favor vote aye, opposed no. We're voting on ceasing debate. Have you all voted? Record, please.
CLERK: 25 ayes, 1 nay to cease debate.
SENATOR CROSBY: Debate ceases. Senator Beutler, you're recognized to close on your amendment.
SENATOR BEUTLER: Senator Crosby, members of the Legislature, we're at a juncture here, and it is hard for us all to keep our equilibrium and to do what's right and what's fair. But I think if you put aside all outside influences and look to your own mind, as you as ... as you have analyzed this problem and look to your own mind, as you have prioritized your goals for this session, I think that a vast majority of this Legislature has prioritized property tax relief first. Everything we are ... we are designing is towards that property tax relief. We ought not to be giving the message that there is something to interfere with that goal. The message ought to be that the income tax cut is there if we can do it, and to the extent that we can do it.
We are willing, we are broad minded, we are flexible, but we are also focused. We are also focused. And this delivers the message of focus that I think we need to deliver. Thank you.
SENATOR CROSBY: Thank you, Senator Beutler. You've heard the closing. The question is the adoption of the Beutler amendment to the committee amendments to LB 401. All in favor vote aye, opposed no. Record, please.
CLERK: (Read record vote. See pages 1967-68 of the Legislative Journal.) 25 ayes, 6 nays on the amendment.
SENATOR CROSBY: The amendment is adopted.
CLERK: Madam President, the next amendment, Senator Chambers has the next ... actually, Senator Beutler, yours is to the bill. Withdraw, Senator, thank you. Senator Chambers, next two amendments, Senator.
SENATOR CHAMBERS: I would withdraw. those and let them be refiled on Select, should we get there.
SENATOR CROSBY: No objections, it is with...
CLERK: I have. nothing further pending to the committee amendments.
SENATOR CROSBY: Senator Wickersham, you are recognized to ... any further discussion on the committee amendments? Senator Maurstad.
SENATOR MAURSTAD: Thank you, Madam President. Obviously, that's, I guess in my vernacular, the ... what may be called a good old fashioned shellacking, where a lot of what was previously gained was lost, and I can accept that. Obviously we'll move the bill to Select File and we'll look at seeing whether or not we can restore part of the rate. Maybe we can convince people that there is room to do more than a meager 3.5 percent rate reduction for two years. Maybe we'll have to look at the credit, personal exemption. Maybe we'll need to look at whether $20 is acceptable. Maybe that's not that important a component any more, I personally felt It was with
the amendment that was adopted last week. Obviously, if there's this much caution relative to revenue, we'll have to look at the expenditure spending side, whether or not we'll be able to support all the A bills that are on General, Select, and Final Reading, whether or not we're going to adopt a budget that's going to have 5 percent or more increase. But we work through the process, committee amendments there. Looks like we will accomplish one thing, that's advance the bill to Select File. Not all is lost. Have to look at the bright side, Madam President, and then we can take up the fight again there relative to the rate amount, whether that's the right amount. The permanency aspect, whether or not we want to have a savings account that doubles in size, when 18 months ago we didn't even have a savings account. So I appreciated the discussion today. It was an interesting day. I urge my colleagues to advance the committee amendment ... or adopt the committee amendment and advance the bill.
SENATOR CROSBY: Thank you, Senator Maurstad. There are no further lights. Senator Wickersham, I recognize you to close on the committee amendment.
SENATOR WICKERSHAM: Yeah. Thank you, Madam President. I am going to be very brief. The committee amendment as now stated provides for a tax reduction of 3.5 percent of the rate, and in addition provides for a credit of $20 per dependent individual. That's a nonrefundable credit. This would 'take place over two years. I think it's affordable. I think it's appropriate. It leaves us room to provide for property tax relief. It also sends the message to the citizens of the state of Nebraska that we will not collect everything that we possibly can, nor will we spend everything that we can possible collect. I would urge your adoption of the amendments, and then the advancement of the bill.
SENATOR CROSBY: You've heard the closing. The question is the adoption of the committee amendments to LB 401. All in favor vote aye, opposed no. Record, please.
CLERK: 29 ayes, 0 nays, Madam President, on the adoption of the committee amendments.
SENATOR CROSBY: The committee amendments are adopted. Anything further on...
CLERK: Nothing further on the bill at this tire, Madam President.
SENATOR CROSBY: Any discussion on the advancement of LB 401? Seeing none, Senator Wickersham. Senator Coordsen, sorry.
SENATOR COORDSEN: Excuse me, Madam President, I would simply move to advance the bill to E & R for initial.
SENATOR CROSBY: You've heard the closing on advancement of the bill. All in favor vote aye, opposed no. Record, please.
CLERK: 27 ayes, 4 nays on the advancement of LB 401.
SENATOR CROSBY: LB 401 advances. Mr. Clerk, do you have items for the record?
CLERK: I do, Madam President. Amendments by Senator Chambers, (LB) 271; Senator Dierks, to (LB) 806. (See pages 1968-69 of the Legislative Journal.)
Madam President, a priority motion. Senator Coordsen would move to adjourn until 8:30 a.m. tomorrow morning.
SENATOR CROSBY: You've heard the motion to adjourn until 8:30 a.m. tomorrow morning. All in favor say aye. Opposed. We are adjourned.