♪ >>> THE NEBRASKA LEGISLATURE IS GETTING READY FOR ITS 2022 SESSION.

THERE'S SOME BIG PROPOSALS ON THE TABLE FROM REWRITING THE STATE'S TAX SYSTEM AND CHANGING SCHOOL FUNDING TO ECONOMIC DEVELOPMENT AND FLOOD CONTROL PROJECTS.

ALL OF THAT'S AHEAD ON "SPEAKING OF NEBRASKA."

♪ >>> HELLO, AND WELCOME TO THIS SPEAKING OF NEBRASKA 2022 LEGISLATIVE PREVIEW.

I'M FRED KNAPP OF NEBRASKA PUBLIC MEDIA NEWS.

THE LEGISLATURE BEGINS ITS SESSION JANUARY 5 WITH LOTS OF BIG CHANGES SENATORS WILL BE CONSIDERING.

JOINING ME TO TALK ABOUT SOME OF THESE IDEAS ARE THREE KEY SENATORS, LOU ANN LINEHAN WHO CHAIRS THE TAX WRITING REVENUE COMMITTEE; LYNNE WALZ, CHAIR OF THE EDUCATION COMMITTEE WHICH OVERSEES SCHOOL FUNDING; AND MIKE HILGERS, SPEAKER OF THE LEGISLATURE.

THANKS, EVERYBODY, FOR BEING HERE.

>> THANK YOU.

>> THANK YOU.

>> SENATOR HILGERS, LET'S START WITH YOU.

LAST SESSION YOU AND YOUR COLLEAGUES LAUNCHED SOMETHING CALLED THE STATEWIDE TOURISM AND RECREATIONAL WATER ACCESS AND RESOURCE SUSTAINABILITY OR "STAR WARS" SPECIAL COMMITTEE.

BASICALLY THE COMMITTEE'S LOOKING TO IMPROVE TOURISM AND ECONOMIC DEVELOPMENT AROUND PROJECTS AROUND LAKE MCCONAUGHY, THE MISSOURI RIVER IN NORTHEAST NEBRASKA, AND FLOOD CONTROL ON THE LOWER PLATTE.

IS THE FORCE STRONG WITH THIS COMMITTEE, AND WHAT HAVE YOU HEARD FROM CITIZENS ABOUT WHAT THEY WOULD LIKE YOU TO DO?

>> I APPRECIATE THAT VERY MUCH.

THANK YOU FOR THE OPPORTUNITY TO BE HERE, FRED, WITH MY GREAT COLLEAGUES.

THE STAR WARS COMMITTEE IS KIND OF A FUN NAME BUT IT'S A VERY SERIOUS AND POTENTIALLY TRANSFORMATIONAL COMMITTEE WITH A VERY SERIOUS FOCUS AND TASK.

IT HAS TEN MEMBERS OF THE LEGISLATURE SO A FULL 20 PERCENT OF THE LEGISLATIVE BODY IS ON THE COMMITTEE, AND THE TASK THE LEGISLATURE GAVE THE COMMITTEE WAS HOW CAN WE LOOK AT ONE OF OUR MOST IMPORTANT NATURAL RESOURCES, OUR WATER RESOURCES, AND HOW CAN WE UTILIZE THOSE IN A BETTER WAY?

SOME OF THOSE RESOURCES, AS YOU MENTIONED, ARE KEITH COUNTY, LAKE MCCONAUGHY, OR LEWIS AND CLARK ARE WATER RESOURCES WE ALREADY HAVE.

AND SOME OF ARE MAYBE AROUND THE LOWER PLATTE AREA, WATER RESOURCES THAT WE CAN MAYBE IMPROVE OR CREATE NEW OPPORTUNITIES TO USE THOSE WATER RESOURCES.

SO WE'VE HEARD, WE'VE HAD HEARINGS THROUGHOUT THE STATE IN EACH OF THOSE AREAS, AND WE HAD TREMENDOUS ENERGY FROM PEOPLE ON THE GROUND WHO WERE VERY EXCITED THAT THE LEGISLATURE WAS LOOKING FOR POTENTIALLY ONE-OFF TRANSFORMATIVE INVESTMENTS IN THOSE AREAS.

AND FOR LEWIS AND CLARK AND LAKE MCCONAUGHY, WHAT WE HEARD WAS VERY SIMILAR, WHICH IS WE HAVE THESE TREMENDOUS LAKE OPPORTUNITIES, LAKES THAT EXIST, AND WHAT WE WANT IS MORE ACCESS TO THE WATER.

WHETHER IT'S A MARINA OR BETTER ROADS OR MORE AMENITIES ON THE WATER, WE'VE GOT THE WATER.

WE HAVE THE THING THAT NEBRASKANS LOVE TO ENJOY, BUT HOW DO WE GET MORE OPPORTUNITIES TO BE ABLE TO USE THE WATER?

WHAT WE HEARD NEAR THE LOWER PLATTE AREA BETWEEN NEBRASKA AND -- I'M SORRY, BETWEEN LINCOLN AND OMAHA, WAS ONE PIECE WAS FLOOD CONTROL.

THAT WAS A PLACE THAT WAS DEVASTATED FROM THE 2019 FLOODS.

AND ANOTHER WAS ARE THERE OPPORTUNITIES TO BE ABLE TO BUILD POTENTIAL WATER RESOURCES OR RECREATIONAL ACTIVITIES NEAR THE PLATTE RIVER?

THAT HAS BEEN AN AREA THAT HAS HAD A LOT OF CONTROVERSY IN THE PAST WITH THE POSSIBILITY OF SAY, FLOODING ASHLAND.

OUR COMMITTEE WAS FOCUSED NOT ON THAT, AND HOW CAN WE BUILD SOMETHING AND DO SOMETHING THAT ACTUALLY RESPECTED ASHLAND AND ALL THE GREAT ECONOMIC DEVELOPMENT THAT'S GOING ON THERE.

SO THAT'S WHAT WE HEARD IN THE VARIOUS AREAS, FRED, AND WE THINK THAT WE'RE STILL IN THE FINAL -- WE'RE AT THE 5-YARD LINE OF THIS PROCESS AND WE HAVE A LITTLE WAYS TO GO YET, BUT WE THINK THERE'S SOME REALLY, REALLY NEAT AND POTENTIALLY TRANSFORMATIVE OPPORTUNITIES FOR THE STAR WARS COMMITTEE TO PROPOSE TO THE LEGISLATURE IN 2022.

>> SOUNDS EXCITING AND, SENATOR WALZ, THAT AFFECTS YOUR AREA, TOO.

DO YOU HAVE ANY INPUT INTO THIS OR HAVE YOU BEEN FOLLOWING IT?

>> I HAVE BEEN FOLLOWING IT A LITTLE BIT, AND I'M JUST REAL EXCITED ABOUT THE OPPORTUNITY THAT WE HAVE TO BRING MORE RECREATION TO OUR STATE, YOU KNOW, IN ORDER FOR US TO KEEP YOUNG PEOPLE, YOUNG FAMILIES HERE, WE HAVE TO DO THINGS LIKE THIS SO I LOVE WATER, AS WELL.

I'M EXCITED ABOUT THE OPPORTUNITIES THAT THEY'RE BRINGING.

>> SENATOR LINEHAN, YOU'RE A LITTLE BIT OFF THE BEATEN TRACK FOR THIS PROJECT IN ELKHORN BUT DO YOU HAVE ANY THOUGHTS ON THAT?

>> WELL, ACTUALLY WHERE I LIVE IN ELKHORN AND ELKHORN ITSELF IS REALLY -- I THINK WE UNDERUTILIZE OUR WATER RESOURCES AND I'M VERY EXCITED ABOUT WHAT THEY'RE LOOKING AT BECAUSE I LIVE ON THE ELKHORN RIVER CLOSE ENOUGH, IT'S LIKE HALF A MILE, AND WE'RE NOT TOO FAR FROM WHERE IT FLOWS INTO THE PLATTE, AND WE HAVE GREAT PARKS AROUND THAT AREA BUT I THINK MAYBE MORE COULD BE DONE TO CONNECT THEM SO I'M VERY EXCITED TO SEE WHAT THEY COME UP WITH.

>> OKAY.

WE'LL BE WATCHING FOR THAT.

NOW, YOU ARE, AS CHAIR OF THE REVENUE COMMITTEE, GOING TO BE CONSIDERING SOME MAJOR PROPOSALS THIS YEAR.

THE BUSINESS ORIENTED GROUP BLUEPRINT NEBRASKA HAS PROPOSED THE ISSUE TO REPORT CALLING FOR LOWER INCOME TAXES, ABOLISHING INCOME TAXES FOR INDIVIDUALS WITH INCOMES UNDER $50,000, AND TAXING MORE SERVICES LIKE HOME AND AUTO REPAIRS.

YOU'VE LONG SUPPORTED LOWERING INCOME TAXES BUT WHAT DO YOU THINK ABOUT PAIRING THAT WITH TAXING MORE SERVICES AND WHAT'S THE LINEHAN PLAN?

>> WELL, LINEHAN DOESN'T HAVE A PLAN PER SE.

I'VE TALKED TO SEVERAL MEMBERS OF THE REVENUE COMMITTEE, AND WE WERE, I THINK, QUITE SUCCESSFUL LAST YEAR WORKING TOGETHER AS A GROUP AND THAT'S WHAT WE PLAN ON DOING THIS YEAR.

I EXPECT THAT PARTS OF THE BLUEPRINT, WHICH I REALLY WANT TO THANK THE INDIVIDUALS THAT PUT THE TIME AND EFFORT INTO BLUEPRINT, THEY HAVE SOME GREAT IDEAS.

I'M NOT SURE THAT ALL OF THEM ARE DOABLE RIGHT NOW.

I THINK IT'S VERY DIFFICULT TO EXPAND THE TAX BASE WHEN WE'RE IN THE FINANCIAL SITUATION WE ARE IN WHERE WE ARE -- >> TECHNICALLY, SWIMMING IN MONEY.

>> WE TECHNICALLY ARE, AND NOT BECAUSE OF THE BILLION DOLLARS OF THE FEDERAL MONEY BUT BECAUSE OUR REVENUES ARE JUST UP SO MUCH HIGHER THAN WHAT WE ANTICIPATED.

I THINK IF I REMEMBER, AND I HAVE IT HERE, THERE'S OVER $400 MILLION NOW IN THE BUDGET THAT WE DIDN'T KNOW WAS GOING TO BE THERE.

PLUS, WE ARE WELL OVER A BILLION DOLLARS IN THE RAINY DAY FUND.

PLUS, WE HAVE OUR MINIMUM RESERVE OF OVER $300 MILLION.

I THINK ANY EXPANSION OF TAXES WHEN YOU HAVE THAT KIND OF REVENUE IN HAND IS PROBABLY NOT POLITICALLY DOABLE IN AN ELECTION YEAR.

>> OKAY.

THOUGHTS ON THE SITUATION THAT THE SENATOR JUST DESCRIBED?

SENATOR HILGERS.

>> WELL, I WILL SAY I THINK THERE'S AN OPPORTUNITY FOR TAX RELIEF IN LARGE PART BECAUSE THE LEGISLATURE OVER THE LAST SIX YEARS HAS BEEN VERY DISCIPLINED WITH ITS SPENDING.

WE'VE AVERAGED JUST UNDER 2%, I BELIEVE, ON OUR BIANNUAL BUDGETS AND BECAUSE OF THAT, BECAUSE WE WERE DISCIPLINED, WE HAVE EXCESS REVENUES, AND WE'VE GOT AN OUTSTANDING REVENUE COMMITTEE.

CHAIR LINEHAN PRESIDED OVER WHAT I UNDERSTAND IS MAYBE THE BEST TAX CUTTING YEAR IN AT LEAST THE 25 YEARS AS FAR AS RECORDS GO BACK LAST YEAR.

HUNDREDS OF MILLIONS IN DOLLARS IN TAX CUTS, AND I THINK SHE'S GOT A GREAT COMMITTEE.

AND I THINK FOLLOWING THAT PATH NEXT YEAR IS WHAT I THINK WILL PROBABLY HAPPEN WHERE WE'RE TAKING EXCESS REVENUES AND STARTING TO CUT TAXES.

EXACTLY WHICH WAY WE GO, I DEFER TO OUR GREAT COMMITTEE, BUT THERE'S NO DOUBT THAT THERE'S URGENCY TO CUT TAXES HERE IN NEBRASKA.

WE HAVE A 1967 TAX CODE, WE'RE IN A VERY INFLATIONARY ENVIRONMENT.

NEBRASKANS AND NEBRASKA FAMILIES AND BUSINESSES NEED TO KEEP MORE OF THEIR OWN DOLLARS, AND I THINK THERE WILL BE URGENCY NEXT YEAR TO CUT WHATEVER TAXES WE CAN.

>> SENATOR WALZ, I WANT TO GET TO YOUR THOUGHTS ON TAXES BUT FIRST, ANY REACTION TO WHAT YOU'VE HEARD SO FAR?

>> NO.

>> YOU HAVE A PROPOSAL TO MAKE: SIGNIFICANT CHANGES IN SCHOOL FUNDING.

IT INVOLVES SETTING ASIDE HALF A CENT OF SALES TAX FOR SCHOOLS, INCREASING THE AMOUNT OF INCOME TAX GOING TO SCHOOLS, AND OVERALL INCREASING THE AMOUNT OF AVAILABLE FOR SCHOOL AID BY MORE THAN $700 MILLION FROM THE CURRENT $1 BILLION A YEAR.

WHAT WOULD BE THE GOAL OF ALL THESE CHANGES THAT YOU'VE TALKED ABOUT?

>> WELL ACTUALLY, FRED, THERE'S TWO GOALS AND FIRST AND FOREMOST IT IS MAKING SURE THAT WE ARE PROVIDING SUSTAINABLE, DEDICATED FUNDING FOR OUR SCHOOLS.

AS WE KNOW, EDUCATION IS KEY TO ECONOMIC DEVELOPMENT IN NEBRASKA AND SO WE NEED TO MAKE SURE THAT WE'RE PROTECTING FUNDS AND THAT WE'RE DEDICATING AND SUSTAINING FUNDS FOR EDUCATION THROUGHOUT.

SECONDLY, THIS PROPOSAL THAT WE'RE BRINGING FORTH THIS YEAR DOES PROVIDE A SIGNIFICANT AMOUNT OF TAX RELIEF, PROPERTY TAX RELIEF, FOR NEBRASKANS AND THAT'S ANOTHER PRIORITY WE'VE HEARD AGAIN AND AGAIN AND AGAIN FOR YEARS THAT PEOPLE WANT PROPERTY TAX RELIEF.

SO IT DOES PROVIDE A SIGNIFICANT AMOUNT.

LAST YEAR IF THIS WOULD HAVE BEEN IMPLEMENTED, IT WOULD HAVE PROVIDED US WITH $715 MILLION WORTH OF PROPERTY TAX RELIEF TO PEOPLE.

THERE ARE THREE MAJOR PIECES TO THIS PROPOSAL.

THE FIRST IS THE FUNDING PROPOSAL ITSELF AND YOU TALKED ABOUT THE ESBA OR EDUCATIONAL STABILIZATION BASE AID, WHICH IS A HALF CENT SALES TAX, CURRENT SALES TAX MATCHED BY THE STATE.

AND THOSE FUNDS ARE ALLOCATED OUT TO EVERY STUDENT ACROSS THE STATE.

IT EQUALS ABOUT $1100 PER STUDENT.

THE SECOND MAJOR COMPONENT TO THE FUNDING PROPOSAL IS ALLOCATED INCOME TAX.

AS YOU KNOW WHEN ESBA WAS FIRST CREATED, IT WAS INTENDED THAT 20 PERCENT OF OUR INCOME TAXES WOULD RETURN TO OUR LOCAL SCHOOL DISTRICTS.

OVER THE YEARS, THAT'S DWINDLED DOWN TO ABOUT 2.23 PERCENT AND THE PROPOSAL THAT WE'RE LOOKING AT WOULD BUMP THAT BACK UP TO THE 20 PERCENT SO INCOME TAXES PAID BY YOU TO THE STATE WOULD COME BACK AT 20 PERCENT TO YOUR SCHOOL DISTRICT TO EDUCATE YOUR KIDS.

>> IN THE PAST, PROPOSALS TO INCREASE STATE AID TO RELIEVE PROPERTY TAXES HAVE RUN INTO RESISTANCE BECAUSE THEY DIDN'T INCLUDE ANY NEW CAP ON SCHOOL SPENDING.

IS THAT THE CASE WITH THIS PROPOSAL?

>> YOU KNOW, THAT'S SOMETHING THAT -- THIS PROPOSAL IS STILL EVOLVING, AND WE HAVE HAD OVER THE PAST SIX MONTHS, WE'VE TALKED WITH MANY, MANY SUPERINTENDENTS, MANY SENATORS.

IN FACT, 41 SENATORS INCLUDING SENATOR HILGERS AND SENATOR LINEHAN, WE'VE TALKED WITH SCHOOL GROUPS, FARM BUREAU, THE CHAMBER, AND WE ARE TRYING TO GET AS MUCH INPUT AND FEEDBACK ABOUT THE PROPOSAL AS POSSIBLE.

EVERY TIME WE HAVE CONVERSATIONS, THERE ARE CHANGES THAT HAVE BEEN MADE TO THE PROPOSAL, AND IT'S ONLY MADE THIS PROPOSAL BETTER SO WE'RE CONTINUING TO HAVE THOSE DISCUSSIONS.

>> SENATOR LINEHAN, OBVIOUSLY THIS INTERSECTS WITH A LOT OF WORK OF YOUR COMMITTEE.

WHAT ARE YOUR THOUGHTS ON THIS APPROACH?

>> WELL, I REALLY, REALLY APPRECIATE THE FACT THAT CHAIRMAN WALZ AND THE SCHOOL OFFICIALS THAT HAVE BROUGHT THIS PROPOSAL FORWARD, I APPRECIATE THAT VERY MUCH BECAUSE SINCE I'VE BEEN HERE, IT'S BEEN KIND OF A -- WE HAVEN'T BEEN ABLE TO BRIDGE THE GAP SO I THINK THIS PROPOSAL IS HELPFUL IN THAT REGARD.

I'M NOT QUITE SOLD ON EVERY PIECE OF IT, BUT I DO THINK AND I'VE THOUGHT SINCE I'VE BEEN HERE, THAT WE NEED TO REDO OUR SCHOOL FINANCING SO AT LEAST IT'S A STEP IN THE RIGHT DIRECTION BUT AS WE ALL KNOW, ESPECIALLY WHEN YOU'RE WRITING LEGISLATION, THE DEVIL'S ALWAYS IN THE DETAILS.

>> SENATOR HILGERS.

>> WELL, I WOULD ECHO WHAT SENATOR LINEHAN SAID.

I REALLY AM GRATEFUL FOR THE WORK THAT SENATOR WALZ AND HER TEAM HAVE DONE AND THE SCHOOL ADMINISTRATORS AND THEIR WORK TO PUT TOGETHER THIS PROPOSAL.

IN ORDER TO DO BIG THINGS, WE HAVE TO HAVE A LOT OF THOUGHT AS PART OF A COMPREHENSIVE PLAN, AND THEY'VE BEEN DOING THAT AND CONTINUE TO DO THAT AS SENATOR WALZ NOTED.

I KNOW THEY'VE HAD MULTIPLE ITERATION OF THIS PARTICULAR BILL, AND I EXPECT IT TO CONTINUE TO EVOLVE.

AS IT GETS INTRODUCED AND GOES THROUGH THE COMMITTEE PROCESS, I'M SURE I WILL HAVE SPECIFIC CONVERSATIONS WITH SENATOR WALZ.

WE HAVE A VERY GOOD WORKING RELATIONSHIP SO WE'LL TALK ABOUT ANY ISSUES THAT I MIGHT HAVE.

I WILL SAY OBSERVING THE LEGISLATURE AND WE'VE HAD DIFFERENT PIECES -- WE'VE HAD DEBATES OVER DIFFERENT PIECES OF THIS BEFORE, WHETHER IT'S SPENDING CAPS OR CHANGES TO TIOS OR THE LIKE.

MY SENSE IS ANY SUCCESSFUL BILL IN ORDER TO OVERCOME A FILIBUSTER WOULD PROBABLY HAVE AT LEAST THREE ELEMENTS.

ONE ELEMENT WOULD BE THAT WE'D HAVE TO HAVE SOME ADDITIONAL FUNDING FOR UNEQUALIZED SCHOOL DISTRICTS.

ANOTHER ELEMENT WOULD BE WE WOULD -- >> THOSE ARE THE DISTRICTS THAT DON'T GET AID ON THE BASIS OF BEING PROPERTY POOR?

>> THAT'S RIGHT.

CORRECT.

SO THAT WOULD BE ONE.

ANOTHER ONE WOULD BE THAT IT DOESN'T RAISE TAXES AND IN FACT -- THAT'S CERTAINLY ON THE OTHER SIDE OF THAT COIN WOULD BE THAT HOPEFULLY IT WOULD REDUCE PROPERTY TAXES.

AND THE THIRD WOULD BE HAVE TO HAVE SOME KIND OF SPENDING RESTRICTION ON SCHOOLS AND THEIR ABILITY WITH REASONABLE EXCEPTIONS TO THAT OF COURSE, BUT SOME KIND OF LIMIT ON THEIR GROWTH.

I THINK IN THE ABSENCE OF ONE OF THOSE, IT WOULD BE VERY DIFFICULT TO GET 33 WITHIN THE LEGISLATIVE BODY, BUT CERTAINLY WE'LL SEE HOW THE PROPOSAL EVOLVES THROUGH THE COMMITTEE PROCESS AND ONTO THE FLOOR.

>> ALL RIGHT, VERY GOOD.

IF YOU'RE JUST JOINING US, THIS IS "SPEAKING OF NEBRASKA," LEGISLATIVE PREVIEW ON NEBRASKA PUBLIC MEDIA.

I'M FRED KNAPP AND WITH ME ARE SENATORS MIKE HILGERS, LYNNE WALZ, AND LOU ANN LINEHAN.

I WANT TO ASK EACH OF YOU ABOUT SOME OF THE OTHER TOPICS THAT ARE LIKELY TO COME UP.

THERE WAS A PROPOSAL LAST SESSION FOR A NEW PRISON.

IT WAS MADE BY CORRECTIONS DIRECTOR SCOTT FRAKES AND SUPPORTED BY GOVERNOR PETE RICKETTS.

IT'S FOR 1500 BEDS COSTING $235 MILLION.

SO FAR THE LEGISLATURE SET ASIDE ABOUT HALF THAT AND AUTHORIZED DESIGN AND SITE SELECTION BUT HASN'T GIVEN THE FINAL GO AHEAD.

AT THE SAME TIME, OFFICIALS ARE WORKING WITH THE FEDERALLY FUNDED CRIMINAL JUSTICE INSTITUTE OR CJI ON PROPOSALS THAT COULD REDUCE OR HOLD DOWN GROWTH IN FUTURE PRISON POPULATIONS.

WHERE DO YOU SEE THIS ISSUE GOING?

SENATOR HILGERS?

>> WELL, FIRST, I THINK THOSE TWO ISSUES ARE A LITTLE BIT SEPARATED.

THE FIRST ISSUE ON THE NEW PRISON IS REALLY NOT A SENTENCING, IT'S NOT A REACTION TO SENTENCING REFORM.

IT'S REALLY A REPLACEMENT FOR AN SP AND I THINK THE GOVERNOR'S MADE -- >> NEBRASKA STATE PENITENTIARY.

>> AND THE GOVERNOR'S MADE A VERY STRONG CASE, ONE THAT I AGREE WITH, THAT NSP HAS REACHED THE END OF ITS USEFUL LIFE AND THE QUESTION IS WHETHER OR NOT WE WANT TO BUILD A NEW PRISON INCREASE CAPACITY.

IT'S WHETHER OR NOT WE WANT TO PUT $200 MILLION OR $150 MILLION TRYING TO REHAB AN OLD FACILITY VERSUS SPENDING THOSE DOLLARS ON A NEW FACILITY TO REPLACE NSP AND GAIN ALL THE EFFICIENCIES FROM NEW CONSTRUCTION AND ALL THE NEW TECHNOLOGIES AND BEST PRACTICES IN CORRECTIONS FACILITIES, SO I THINK THAT IS ON A SEPARATE TRACK.

I WOULD EXPECT THAT THE GOVERNOR WOULD BRING THAT AS PART OF HIS BUDGET PROPOSAL AT THE BEGINNINGS OF NEXT SESSION, AND I THINK THERE PROBABLY WOULD BE A LOT OF SUPPORT FOR THE NSP REPLACEMENT.

CJI, THAT IS A THREE BRANCH EFFORT WITH THE EXECUTIVE BRANCH, THE JUDICIARY AND THE LEGISLATIVE BRANCH.

WE HAVE A NUMBER OF MEMBERS, INCLUDING THE CHAIR OF THE JUDICIARY COMMITTEE SENATOR LATHROP AS WELL AS SENATOR MCKINNEY AND SENATOR GEIST WHO ARE REPRESENTATIVES FROM THE LEGISLATIVE BRANCH.

IT'S REALLY DATA-BASED AND THEY'RE LOOKING THROUGH A LOT OF DATA WITH THE CJI NUMBER CRUNCHERS.

I HAVEN'T HEARD OF ANY PRELIMINARY PROPOSALS THAT HAVE COME OUT OF THAT DATA SET BUT I WILL SAY, THEY'VE GOT THE RIGHT PEOPLE AT THE TABLE SO IF THAT GROUP CAN COME UP WITH SOME AGREED UPON PROPOSALS, WE COULD MAKE SOME TRANSFORMATIVE CHANGES NEXT YEAR.

>> I KNOW ONE OF THE THINGS THEY'RE CONSIDERING IS HOW TO REDUCE RECIDIVISM, THAT PEOPLE COMING BACK INTO THE PRISON SYSTEM ONCE THEY'VE BEEN LET OUT, BUT THE PRISONS ARE AT LIKE 150, 160 PERCENT OF CAPACITY.

IF YOU JUST REPLACE THE PENITENTIARY, YOU DON'T NECESSARILY DO ANYTHING TO REDUCE OVERCROWDING SO WHAT DO YOU GUYS THINK ABOUT THE NEW PRISON AND HOW IT FITS WITH THE BIG PICTURE?

>> I WOULD HAVE TO SAY THAT FIRST OF ALL, WE DO HAVE THE RIGHT PEOPLE WORKING ON THAT WITH SENATOR LATHROP, SENATOR MCKINNEY, AND SENATOR GEIST.

I THINK THAT THEY'RE DOING A GREAT JOB BUT I THINK IT'S REALLY IMPORTANT TO REMEMBER THAT REGARDLESS OF A NEW PRISON OR NOT, WHATEVER FACILITY, YOU KNOW, THEY DECIDE UPON, PROGRAMMATIC -- THE PROGRAMMATIC PART OF THAT REHAB IS IMPORTANT IN MAKING -- >> LIKE ANGER MANAGEMENT CLASSES, THAT SORT OF THING.

>> RIGHT, TRAINING AND THE POSSIBILITY OF ONGOING EDUCATION OR, AGAIN, JUST MAKING SURE THAT PEOPLE ARE -- HAVE THE OPPORTUNITY FOR PROGRAMMATIC REHAB.

>> YEAH.

>> AND THAT THEY'RE READY TO LEAVE PRISON.

THAT THEY'RE READY TO GO BACK OUT IN SOCIETY AND BE PRODUCTIVE CITIZENS.

THAT'S, I THINK, KEY.

>> SENATOR LINEHAN?

>> I WOULD AGREE THAT I THINK THE GOVERNOR'S ON THE RIGHT TRACK HERE.

I DON'T THINK WE CAN REHAB THE PRISON WE HAVE.

I THINK IT MAKES MORE SENSE TO BUILD A NEW PRISON AND TO INCLUDE AS SENATOR WALZ SAID, THE PROGRAMS THAT HELP PEOPLE FROM COMING BACK TO PRISON.

WE CLEARLY -- IT'S NOT IN ANY OF OUR INTERESTS TO HAVE MORE PEOPLE IN PRISON THAN ABSOLUTELY NECESSARY.

SO I'M HOPEFUL THAT WE CAN FIND THE WAYS FORWARD TO WE CAN KEEP PEOPLE THAT THEY HAVE TO BE IN PRISON THAT WHEN THEY GET OUT, THEY STAY OUT AND I DON'T SEE HOW YOU DO THAT WITH THE STRUCTURE THAT WE HAVE NOW.

WE DON'T HAVE -- PLUS YOU HAVE AN OLD STRUCTURE AND IT'S DANGEROUS.

WE HAVE A PROBLEM WITH TURNOVER SO I'M VERY HOPEFUL THAT THE LEGISLATURE AND THIS COMMISSION CAN COME FORTH WITH SOME THINGS THAT PUT US IN A BETTER PLACE AND HEAD US IN A BETTER DIRECTION.

>> ANOTHER THING THAT'S GOING ON WITH THE PRISONS OBVIOUSLY IS THE STAFF SHORTAGE, BUT THE STATE HAS RECENTLY NEGOTIATED BIG PAY INCREASES AND IT LOOKS LIKE AT LEAST INITIALLY THOSE ARE GETTING MORE PEOPLE TO APPLY.

DO YOU THINK THAT THAT SITUATION IS UNDER CONTROL ENOUGH SO THAT YOU COULD STAFF A NEW PRISON?

>> I THINK IT'S HOPEFUL.

I THINK WE'RE GOING TO HAVE PROBLEMS NOT JUST WITH PRISONS.

WE HAVE PROBLEMS WITH TEACHERS.

WE DON'T HAVE ENOUGH PEOPLE IN NEBRASKA SO EVERYBODY'S LOOKING FOR HELP, AND NOW WE HAVE INFLATIONARY PRESSURES SO I THINK WE HAVE TO LOOK LIKE AT THE WHOLE PICTURE AND GOING BACK TO THE REVENUE, WE HAVE TO DO SOMETHING ABOUT THE TAX STRUCTURE IN NEBRASKA.

THAT'S WHERE BLUEPRINT'S ABSOLUTELY RIGHT.

WE'RE CHASING PEOPLE OUT OF THE STATE, AND IT'S HARD FOR YOUNG FAMILIES TO MAKE ENDS MEET ON THOSE KINDS OF WAGES, EVEN THOUGH IT'S A HUGE INCREASE.

SO I THINK WE'VE GOT CHALLENGES, BUT I DO THINK IT'S VERY POSITIVE THAT THEY CAME TO AN AGREEMENT AND NOW WE'RE ON A BETTER TRACK TO KEEP AND RETAIN PEOPLE IN THOSE JOBS.

>> SHE'S RAISED A BIG PICTURE QUESTION ABOUT, YOU KNOW, POPULATION AND WORKER SHORTAGE.

YOU GUYS, THOUGHTS ON THAT?

SENATOR WALZ.

>> WELL, I WOULD JUST HAVE TO AGREE WITH HER.

I THINK THAT ALL THREE OF THESE PROPOSALS THAT WE'RE BRINGING TODAY ALL ATTRACT EITHER PEOPLE COMING TO NEBRASKA OR RETAINING FAMILIES IN NEBRASKA.

>> OKAY.

SENATOR HILGERS.

>> WE HAVE A RECORD LOW UNEMPLOYMENT RATE, 1.9 PERCENT, WHICH I UNDERSTAND IS A RECORD LOW AS IT'S BEEN RECORDED FOR ANY STATE IN THE COUNTRY FOR THE LAST SEVERAL DECADES, WHICH I THINK IS A REFLECTION OF THE GOOD ECONOMY WE HAVE BUT IT'S ALSO A REFLECTION WE DON'T HAVE ENOUGH PEOPLE.

AS SENATOR WALZ NOTED, THAT'S A MULTI-PRONG STRATEGY.

YOU HAVE TO HAVE -- I THINK THEY'RE HAVING GOOD RECREATIONAL OPPORTUNITIES AND THINGS THAT PEOPLE WANT TO DO OUTDOORS IN THIS POST-COVID ENVIRONMENT.

I THINK IT'S A CRITICAL PIECE OF IT.

MAKING SURE PEOPLE CAN AFFORD TO BUY HOMES AND RAISE THEIR FAMILY OR START BUSINESSES IS A REALLY CRITICAL PART OF IT, AND MAKING SURE THEY CAN HAVE THEIR KIDS AND CHILDREN OR GRANDKIDS HAVE A REALLY SOLID EDUCATION THAT IS A GREAT EQUALIZER IN OUR SOCIETY I THINK IS A BIG PART OF IT.

SO ALL OF THE THINGS WE'RE WORKING ON, THERE'S NO SILVER BULLET TO THIS PARTICULAR WORK FORCE PROBLEM, BUT ALL THESE THINGS WORKING TOGETHER I THINK CAN MAKE A BIG DENT.

>> WE REFERRED TO IT A LITTLE BIT EARLIER BUT IN ADDITION TO STATE REVENUES COMING IN, THE STATE'S GOING TO BE GETTING ALL THIS BILLION DOLLARS FROM THE AMERICAN RESCUE PLAN ACT OR ARPA, OVER A BILLION DOLLARS IN FUNDING THAT YOU GUYS ARE GOING TO HAVE TO DECIDE HOW TO SPEND.

THERE'S LOTS OF PROPOSALS BEING FLOATED, BUT I'D LIKE TO ASK EACH OF YOU WHAT PRIORITIES YOU WOULD HAVE FOR THAT MONEY.

LET'S START WITH YOU, SENATOR WALZ.

>> WELL, I THINK IT'S IMPORTANT THAT WE ADDRESS THE TEACHER SHORTAGE BUT THE WORK FORCE SHORTAGE AS A WHOLE.

I CERTAINLY THINK THAT, YOU KNOW, I HEAR EVERY DAY THAT WE HAVE A WORK FORCE SHORTAGE REGARDLESS OF WHERE IT'S AT WHETHER IT'S IN A SCHOOL OR A HEALTHCARE DEPARTMENT OR, YOU KNOW, A FACTORY.

I THINK MAKING SURE THAT WE HAVE INCENTIVES TO BRING PEOPLE TO NEBRASKA IS AN IMPORTANT PART OF SPENDING THOSE DOLLARS.

>> OKAY, SENATOR HILGERS?

>> WELL, I THINK I UNDERSTAND FROM SENATOR STINNER THAT THERE'S BEEN MAYBE -- >> HE'S THE CHAIR OF THE APPROPRIATIONS COMMITTEE, YEAH.

>> THERE'S BEEN SEVERAL BILLION DOLLARS OF REQUESTS SO WE KNOW WE'RE GOING TO HAVE MORE POTENTIAL PROJECTS THAN DOLLARS WE HAVE TO SPEND AND WE HAVE TO DO IT WISELY SO MY APPROACH IS TO LOOK FIRST AT THINGS THAT ARE ONE OFF THAT CAN BE TRANSFORMATIVE.

IN OTHER WORDS CREATING PROGRAMS THAT CREATE ADDITIONAL ONGOING, RECURRING OBLIGATIONS ON BEHALF OF THE STATE OR TAXPAYER DOLLARS ARE NOT PROJECTS THAT I WOULD LOOK TO SUPPORT.

I THINK HAVING SOMETHING LIKE THAT, I THINK HAVING IT BE BALANCED.

I DON'T THINK THE EASTERN PART OF THE STATE SHOULD HAVE MORE OF THE DOLLARS THAN THE WESTERN PART OF THE STATE OR VICE VERSA OR NORTH TO SOUTH, SO I THINK HAVING A BALANCED APPROACH AND REALLY LOOKING FOR THOSE TYPES OF THINGS THAT HAVE A GOOD BUSINESS CASE THAT COULD POTENTIALLY HAVE A MULTIPLE ON THE DOLLAR SPENT.

WHAT KIND OF THINGS COULD WE LOOK TO DO THAT COULD BE TRAJECTORY CHANGING FOR THE STATE OF NEBRASKA?

I WILL SAY, FRED, THE RESTRICTIONS ON ARPA AS WE SIT HERE TODAY THAT'S MORE RESTRICTIVE FOR A STATE LIKE NEBRASKA, WHO DIDN'T HAVE REVENUE LOSS, AND HAS A LOWER UNEMPLOYMENT RATE THAN IT MIGHT BE FOR OTHER STATES.

IN THOSE STATES THAT HAVE FEWER RESTRICTIONS ON THE ARPA DOLLARS SO OTHER STATES MAY HAVE BUILT A PRISON FOR INSTANCE.

THOSE ARE THINGS WE CAN'T DO SO IT HAS TO FIT WITHIN THE LEGAL PARAMETERS THAT THE FEDERAL GOVERNMENT HAS GIVEN US BUT WITHIN THAT, I THINK ONE OFF TRANSFORMATIVE INVESTMENTS ARE WHAT A LOT OF THE BODY WILL BE LOOKING TOWARDS.

>> ISN'T ONE OF THOSE FEDERAL CONDITIONS THAT YOU CAN'T USE IT TO REPLACE STATE TAX FUNDING SO YOU CAN'T USE IT JUST TO SAY, OKAY, LET'S REDUCE TAXES BY $1 BILLION?

>> SO THERE ARE RESTRICTIONS ON DIRECT TAX REDUCTION, BUT THERE'S ACTUALLY -- IT WAS LITIGATED OR AT LEAST THERE WAS A LEGAL FIGHT OVER WHETHER THE INITIAL TREASURY GUIDANCE WAS THAT STATES COULDN'T INDIRECTLY CUT TAXES AND NO ONE REALLY KNEW EXACTLY WHAT THAT MEANT AND WHETHER THAT WOULD BE AN UNFAIR RESTRICTION -- UNCONSTITUTIONAL RESTRICTION ON STATE ACTIONS SO THAT PIECE HAS BEEN PUSHED BACK SO I DON'T THINK THAT THE FEDERAL GUIDANCE AS IT CURRENTLY STANDS IS THAT YOU COULD TAKE A DOLLAR OF ARPA MONEY AND CUT DIRECTLY A DOLLAR OF TAXES BUT CERTAINLY DOES NOT RESTRICT THE STATE FROM DOING WE ALL HOPE SENATOR LINEHAN WILL DO WITH HER COMMITTEE NEXT YEAR, WHICH IS CUT TAXES GENERALLY.

>> AND HOW WILL THE FEDERAL MONEY THAT'S AVAILABLE PLAY INTO THAT EFFORT DO YOU THINK?

>> WELL, I THINK IT TAKES -- WHEN WE GET TO THE FLOOR, IT'S ALWAYS KIND OF A BATTLE BETWEEN MORE SPENDING OR CUTTING TAXES.

SO I THINK THE FACT THAT THERE'S A BILLION DOLLARS TO SPEND TAKES SOME OF THE HEAT OFF WHETHER WE HAVE ANY MONEY TO CUT TAXES.

I JUST THINK YOU CAN'T -- IF WE HAVE A BILLION PLUS -- >> EXCUSE ME.

IF IT'S ONE TIME MONEY AND YOU CUT TAXES ON A PERMANENT BASIS, DOESN'T THAT CREATE -- >> BUT THAT BILLION IS OVER AND ABOVE THE $1.4 BILLION THAT WE'RE SITTING ON.

>> OH, THE CASH RESERVE.

>> RIGHT.

>> OKAY.

>> THE CASH RESERVE AND THE MINIMUM RESERVE AND $400 MILLION.

EVEN WHEN THAT'S ALL TAKEN CARE OF, THAT IS GOING TO BE AVAILABLE FOR TAX CUTS OR SPENDING.

>> AND YOU HAVE SOME IN YOUR SOFA CUSHIONS TOO?

>> NO, ACTUALLY I DON'T.

BUT IT IS -- WE ARE IN A WONDERFUL PLACE TO TRY AND LOWER TAXES SO WE CAN KEEP PEOPLE IN NEBRASKA AND WE CAN KEEP YOUNG FAMILIES TO MOVE HERE.

WHEN YOU -- I'VE GOT CHILDREN IN THAT 30 AGE GROUP AND THEY SIT DOWN AND THEY LOOK TO WHERE THEY'RE GOING TO LIVE OR WHERE THEY'RE GOING TO BUY A HOUSE, YOU CAN DO IT MUCH DIFFERENT THAN WHEN I WAS DOING THAT IN MY YOUNG YEARS.

THEY CAN PULL UP AND SEE WHAT THE TAXES ARE, WHAT THE PROPERTY TAXES ARE, WHAT THE RATES ARE, AND THEY EDUCATED PEOPLE THAT WE'RE TRYING TO GET TO NEBRASKA, THEY LOOK AT THOSE THINGS.

WE DO NOT LOOK GOOD IF YOU ARE LIVING IN MANY OF THE STATES THAT HAVE NO INCOME TAXES, MANY OTHER STATES WE'RE ONE OF THE HIGHEST PROPERTY TAX STATES IN THE UNION.

IT JUST DOESN'T LOOK GOOD.

WE HAVE TO CHANGE THAT VISION IF WE WANT PEOPLE TO COME TO NEBRASKA.

>> ALL RIGHT.

WELL, SPEAKING OF VISION, WE'RE ALMOST OUT OF TIME, BUT I'D LIKE TO ASK EACH OF YOU FOR SOME CLOSING THOUGHTS, MAYBE THERE'S SOME LONG-STANDING ISSUE YOU THINK MIGHT FINALLY BE RESOLVED THIS SESSION OR SOME SLEEPER ISSUE THAT'S GOING TO BECOME PROMINENT OR SOMETHING YOU JUST HOPE WILL HAPPEN.

SO LET'S DO THE LIGHTNING ROUND HERE AND START WITH YOU, SENATOR HILGERS.

>> WE ONLY HAVE 60 WORKING DAYS AND WE'RE GOING TO HAVE THE EQUIVALENT OF TWO FULL BUDGETS, ONE FOR THE ARPA DOLLARS AND ONE FOR DEFICIT REQUEST FOR OUR GENERAL FUND EXCESS THAT SENATOR LINEHAN REFERENCED.

THAT'S A LOT OF WORK EVEN IN A 90-DAY SESSION, AND WE ONLY HAVE 60 DAYS SO MY GOAL NUMBER ONE IS TO MAKE SURE THAT WE ARE WISE, THOUGHTFUL, AND DISCIPLINED AND HOPEFULLY ACHIEVE TRANSFORMATIVE RESULTS WITH THOSE DOLLARS IN THAT BUDGET PROCESS.

ANYTHING BEYOND THAT I THINK IS PROBABLY GRAVY FOR THE LEGISLATURE AND THAT'S MY NUMBER ONE FOCUS AND BEYOND THAT, I WILL SAY WE HAVE REALLY SOME TREMENDOUS LEADERS WHO ARE WALKING OUT THE DOOR.

WE'VE GOT A LOT OF LEADERS WHO ARE COMING BACK AND HAVE SHOWN AN ABILITY TO GET MAJOR THINGS DONE SO I HAVE A LOT OF HOPE FOR THIS GROUP WORKING TOGETHER EVEN BEYOND THE FISCAL AND THE BUDGET TO BE ABLE TO DO SOME REALLY IMPORTANT THINGS.

>> ALL RIGHT.

SENATOR WALZ.

>> ONE OF THE OTHER THINGS I JUST WANT TO MENTION THAT I WAS GOING TO CONCENTRATE ON IS OUR INFRASTRUCTURE AND OUR EXPRESSWAYS AND MAKING SURE THAT WE CAN EXPIATE THAT PROCESS.

REGARDLESS OF WHAT WE DO, WE HAVE TO MAKE SURE THAT WE'RE WORKING TOGETHER IN A BIPARTISAN WAY, THAT WE ARE BEING THOUGHTFUL, THAT WE'RE BEING INTENTIONAL, AND THAT WE'RE COMMUNICATING WITH EACH OTHER.

WE HAVE TO MAKE SURE THAT THERE'S A CHECKS AND BALANCES SYSTEM IN PLACE FOR ANY LEGISLATION THAT'S PUT IN PLACE AND AGAIN, JUST CONTINUE TO WORK TOGETHER.

AS SENATOR HILGERS SAID, WE ARE LOSING SOME REALLY KEY SENATORS THIS YEAR SO IT'LL BE A LEARNING YEAR NEXT YEAR FOR EVERYBODY.

>> ALL RIGHT.

SENATOR LINEHAN, YOUR CLOSING THOUGHTS?

>> I AM VERY, VERY HOPEFUL.

I DO THINK WE'VE GOT 12 MEMBERS LEAVING, MANY OF WHOM ARE CHAIRS AND THAT KIND OF EXPERIENCE -- I'M NOT A BIG -- I KNOW PEOPLE LIKE THEM.

I'M NOT A BIG FAN OF TERM LIMITS SO THERE'S THAT CLASS GOING AND THE NEXT CLASS, WHICH IS OUR CLASS, IS 17 MEMBERS SO WE NEED TO GET WHATEVER WE CAN GET DONE THIS YEAR ADDRESSING ALL OF THESE ISSUES, WE NEED TO GET TO IT BECAUSE WE ARE GOING TO HAVE -- WE ALSO HAVE A GOVERNOR WHO SEEMS TO BE GOING TO RUN THROUGH THE TAPE HERE.

HE'S STILL VERY INVOLVED.

HE IS -- AND HE'S GOT THE HISTORY SO I THINK IT'S REALLY INCUMBENT ON US TO MAKE SURE THAT WE USE EVERY ONE OF THOSE DAYS IN A VERY CONSTRUCTIVE WAY TO GET AS MUCH DONE FOR NEBRASKA AS WE CAN.

>> VERY GOOD.

ALL RIGHT, WELL THANKS AGAIN, TO SENATOR LYNNE WALZ, MIKE HILGERS, AND LOU ANN LINEHAN FOR BEING HERE.

THIS INTERVIEW AND TONIGHT'S PROGRAM ARE AVAILABLE ON OUR WEBSITE.

JUST GO TO NEBRASKAPUBLICMEDIA.ORG.

THAT'S ALSO WHERE YOU'LL FIND GAVEL TO GAVEL COVERAGE OF THE LEGISLATURE ONCE IT CONVENES JANUARY 5, AND I'LL HAVE DAILY RADIO NEWS REPORTS ON LEGISLATIVE DEVELOPMENTS AT 5:45 AND 7:45 CENTRAL IN THE MORNING AND 5:45 IN THE EVENING ON NEBRASKA PUBLIC MEDIA RADIO.

THAT'S ALL FOR THIS WEEK ON "SPEAKING OF NEBRASKA."

WE'LL BE BACK IN JANUARY WITH EPISODES ON TOPICS RANGING FROM WORK FORCE SHORTAGES TO AFGHAN REFUGEES IN NEBRASKA, AND A CONVERSATION WITH CHUCK HAGEL ABOUT THE NATION'S DEFENSE.

I'M FRED KNAPP, THANKS FOR JOINING US.

WE'LL SEE YOU IN A FEW WEEKS.

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