Major bills on corrections, taxes headed for debate Wednesday

Only nine days remain in the Nebraska Legislature’s 2022 session

By: - March 29, 2022 6:34 pm
Nebraska State Capitol Building

The Nebraska State Capitol Building in Lincoln. (Rebecca S. Gratz for Nebraska Examiner)

LINCOLN — After two days of acrimony over unsuccessful attempts at compromise, a legislative showdown is coming Wednesday on a major tax relief  bill and a comprehensive criminal justice reform proposal.

 Both bills are scheduled for debate Wednesday.

The fate of those two issues, and the Legislature’s proposal for spending its $1 billion federal American Rescue Plan Act funds, were all uncertain after discussion on and off the floor of the Legislature on Monday and Tuesday.

Only nine days remain in the 2022 legislative session, so time is running short to obtain an agreement over the three issues.

On Tuesday, legislators had to overcoming filibusters to give final approval to three budget bills that allocate state cash reserves and general funds to several projects and priorities.

Those include funds for the proposed Perkins County Canal, rural and urban workforce housing, construction of a national “innovation hub” at Offutt Air Force Base and establishment of a USDA facility at Innovation Campus in Lincoln.

Spending $270 million on a new prison was not a part of the budget. But the Appropriations Committee did set aside $175 million toward the proposed 1,500-bed replacement for the State Penitentiary, which would require legislative approval next year.

Tuesday’s debate focused not on the budget proposal but on a bill crafted by State Sen. Steve Lathrop and the Judiciary Committee to address the state’s chronic prison overcrowding. More than once, Lathrop called for lawmakers to support his “smart on crime” measures and reach an agreement so that all three of the major issues could pass. But a deal wasn’t apparent when the Legislature adjourned after 8 p.m.

Sen. Steve Lathrop
Sen. Steve Lathrop of Omaha (Rebecca S. Gratz for the Nebraska Examiner)

‘A dance partner’

“I’m looking for a dance partner,” said Lathrop during the debate, “someone who will sit down and recognize there’s a way forward on the rest of the session.”

“For the life of me, I don’t know why we’re so resistant to it,” Lathrop said.

While he spoke, Gov. Pete Ricketts issued his weekly column, saying it was “time for action, not antics” and accusing Lathrop of “holding hostage” the session for a handful of “soft-on-crime” reforms.

Non-consensus items

Lathrop, who dominated the floor debate Tuesday, rejected the label, saying Legislative Bill 920 was “smart on crime” and absolutely necessary if the state was going to avoid building two new prisons.

Nebraska Gov. Pete Ricketts
Nebraska Gov. Pete Ricketts (Rebecca S. Gratz for the Nebraska Examiner)

The Omaha senator, who has led legislative studies into overcrowding and other problems faced by state prisons, called on his colleagues to show “political courage” and do what’s needed to solve a real problem.

“Don’t listen to what the campaign managers tell you what to do,” Lathrop said. “This is a big fiscal problem. You’ll need $1 billion in Corrections in the next coming years (if you don’t do this).”

17 consensus items

LB 920 grew out of a six-month study of Nebraska’s criminal justice woes in association with the federal Crime and Justice Institute. Lathrop and Ricketts were among state leaders who called for help from CJI last year as the state eyed building a new, $270-million prison. 

But there wasn’t universal agreement on the 21 steps suggested by the CJI report. The four, “non-consensus” items included medical parole for elderly inmates who no longer pose a threat to others, limits on the use of consecutive sentences and reducing penalties for drug possession.

Ricketts wrote that Lathrop should focus on the 80% of reforms that got a consensus — such as increasing drug courts and halfway houses — instead of seeking non-consensus items that “are complete non-starters” for victims of crime and for promoting public safety.

But Lathrop, over the daylong debate, argued that programs that put inmates in supervised parole release make more sense than spending $43,000-a-year to house them in a state prison.

Avoid ‘jam outs’

He said that such supervision enhances public safety by making sure parolees toe the line and work at a job and is a much better alternative than just letting inmates “jam out” of prison without a period of adjustment on parole.

Sen. suzanne Geist
State Sen. Suzanne Geist of Lincoln (Courtesy of Unicameral Information Office)

On Monday, a group of senators, including Lathrop, Omaha Sens. Terrell McKinney and Mike McDonnell and Lincoln Sen. Suzanne Geist negotiated all day without reaching a deal on the justice reform bill. As evening approached on Tuesday, an agreement was still fleeting.

The lack of a grand bargain threatened to prompt filibusters to block passage of the major tax-relief proposal, and final approval of the ARPA spending bill.

The tax relief proposal, which failed to advance twice last week, combines cuts in the top state income tax rate and the state’s corporate income tax rate with phasing out taxes on Social Security checks and increasing state property tax credits.

Only for wealthy?

It’s been labeled a $900 million package, but opponents worry that such a deep cut in tax revenue risks reductions in spending on education and other priorities.

Critics, including the OpenSky Policy Institute, a Lincoln-based think tank, said the income tax cuts would primarily benefit the wealthy and offer no tax breaks for a couple earning $60,000 or less.

But Elkhorn Sen. Lou Ann Linehan said Tuesday she cannot believe that senators will leave the 2022 session without passing the tax cut proposals.

Albion Sen. Tom Briese, another leading senator on tax issues, said he’ll continue to vote “no” on budget bills until a deal is reached to get the tax relief package passed. It includes $195 million in additional property tax credits, as well as a provision to continue the tax credits passed in 2020 as LB 1107, preventing a $200 million decline in the credits.


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Paul Hammel
Paul Hammel

Senior Reporter Paul Hammel has covered the Nebraska state government and the state for decades. Previously with the Omaha World-Herald, Lincoln Journal Star and Omaha Sun, he is a member of the Omaha Press Club's Hall of Fame. He grows hops, brews homemade beer, plays bass guitar and basically loves traveling and writing about the state. A native of Ralston, Nebraska, he is vice president of the John G. Neihardt Foundation.